e Filing Income Tax

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According to section 139(1) defined under the Income Tax Act, 1961, individuals whose income, from all the sources, during the preceding year is over and above the maximum sum on which taxes cannot be applied, need to e file taxes to claim their returns. In order to help save time and efforts, Income Tax Department of India now allows tax payers to e-file taxes in order to claim returns online. The ease of e filing income tax has made this online process ever-so-popular with tax payers.

If you are a novice taxpayer and are confused about e filing income tax returns, it makes sense to seek help from chartered accountants or tax experts. But even if you’re a little tech savvy, you’ll easily be able to e file taxes to claim returns from the comfort of your home or office.

All you need to do is to register on the official website of the income tax department and follow the instructions for e-filing income tax returns. Typically, July 31st each year remains the due date to e file income tax returns.

Importance of eFiling Income Tax  

E filing income tax returns online is an easy process. No wonder, a large number of taxpayers now prefer to e file taxes to claim returns online rather than do it offline.

However, in order to leverage the advantages of the e filing income tax return process, you must fulfil the following conditions:

  • Your total taxable income must be Rs. 5 Lakhs or more.
  • You must provide an audit report mentioned under sections - 10(23C) (IV), 10(23C) (v), 10(23C) (VI), 10(23C) (via), 10A, 12A (1) (b), 44AB, 80IA, 80IB, 80IC, 80ID, 80JJAA, 80LA, 92E or 115JB of the Income Tax Act.
  • You must provide a notice as per Section 11(2) (a) to the officer who is assessing.
  • You must be an organisation (not under the offerings of section 44AB), BOI, AOP, Cooperative Society, Local Authority (ITR 5) and Artificial Juridical Person.
  • You must be an Individual/HUF resident with properties/assets outside the country to e file tax returns.
  • You must provide returns U/S 139 (4B) (ITR 7).
  • You must be an inhabitant who has the authority to sign in to any account situated outside India.
  • You must be assessee who claims relief as per sections 90 or 90A or deductions as per section 91.

eFiling Income Tax Process

Digital Signature Certificate (DSC) is one of the most aspects of e filing income tax returns. If you wish to submit Income Tax forms by Digital Signature Certificate (DSC), then you need to get in touch with a chartered accountant.

  • If you plan on e-filing income tax returns without a DSC, then an ITR V form gets generated. You’ll need to print this form, sign it and submit it to CPC, Bangalore via ordinary or speed post within 120 days from the date of online return filing.
  • You have the facility to e file tax returns through an E-return Intermediary (ERI). You can do this with or without DSC.

eFiling Income Tax – Things to Remember

In order to easily and effectively complete your income tax filing process to claim your returns, you’ll need to follow a few basic steps. Here’s what you need to follow:

How to Pick the Correct Form for E filing Income Tax?

The process of e filing income tax returns can be confusing if you do not know about the forms you need to fill. So it makes sense to first get acquainted with the right return form for income tax filing online.

Different individuals are required to fill and submit different Income Tax Return (ITR) forms depending on the nature of their profession.

  • ITR 1 (SAHAJ) The source of income is salary and interest
  • ITR 2 A person and Hindu Undivided Families (HUF) having source of income are not from any business or profession
  • ITR 3 A person/HUFs holding partnership in firms and not carrying out profession or business under any proprietorship needs to use this form for online tax filing
  • ITR 4 A person and HUFs who’s source of income from a proprietary business or profession
  • ITR 4S (SUGAM) A person/HUF having presumptive business as the source of income
  • ITR 5 AOPs, Firms, LLP and BOIs
  • ITR 6 Companies that do not claim exemption through section 11 to use this form for income tax e filing
  • ITR 7 Persons inclusive of companies those who need to provide return under section 139(4A) or section 139(4B) or section 139(4C) or section 139(4D)

Form 16 vs. 26AS: Know the Difference before E Filing Income Tax

Before e filing income tax returns, make sure you check Form 26AS. This helps you figure out the amount of total tax deducted from your income and whether it has been deposited to the IT department by your employer. You need to cross check that the tax levied on your salary according to your Form 16 to make sure that it matches with that in Form 26AS. In case you make errors at the time of income tax filing online, the IT department may send you a notice intimating the same.

Claim 80G, Savings Certificates and other Deductions When E Filing Income Tax:

You are allowed to claim extra deductions subject to income tax filing, in case you forgot to do so in the first place. Likewise, if you have made donations to charitable institutions, then you can also claim deductions under the IT section 80G when e filing income tax returns.

Check Your Interest Statement on Savings Accounts and Fixed Deposits Before E Filing Income Tax:

A deduction of Rs.10, 000 is permissible on interest received on savings accounts. On the other hand, interest received on bank deposits is a part of your taxable income. The applicable slab rates decide the tax levied on them. Along with the documents mentioned above, make sure to keep the documents listed below for efiling income tax returns:

  • Preceding year’s tax returns
  • Bank statements
  • Tax Deducted at Source (TDS) certificates
  • Profit and Loss (P&L) Account Statement, Audit Reports and Balance Sheet, if required

General Details Required for E Filing Income Tax Returns:

Listed below are some of the most vital details you’ll require when claiming returns by online income tax filing:

  • Bank account credentials
  • PAN (Permanent Account Number) Number

Calculate the Salary Income When E Filing Income Tax Returns:

Here is a list of a few vital salary details that you need to have when claiming returns by online income tax filing.

  • Rent receipts for claiming HRA
  • Pay slips
  • Form 16

Reporting House Property Income When E Filing Income Tax:

Listed below are some important house property details that you will require when claiming income tax returns by income tax filing online:

  • Address of your property
  • Particulars of your co-owners plus their Part of share in the property along with their PAN details
  • Documentation for interest of your home loan
  • If the property purchased was under construction then you need to give the completion date of the construction.
  • If the property is rented then you need to submit the name of the tenant and the income from the tenant.

Reporting Capital Gains When E Filing Income Tax Returns:

  • To effectively proceed with the process of income tax filing online, along with the purchase details, you need to have a Stock trading statement which is necessary if the seller gains some capital after selling the shares.
  • If a property or house is sold, you need to need to grab hold of purchase price, sale price, capital profit details and details of registration when e filing income tax
  • Particulars of sale purchase and mutual fund statement of debt funds, equity funds, SIPs and ELSS are also required at the time of online income tax filing.

How to Report Income from Other Sources When E Filing Income Tax Returns?

  • The money from the interest needs to be reported at the time of e filing income tax If the interest rates have been accumulated from your savings account, then you need to submit statements of your bank account.
  • Income through interest from corporate bonds and tax savingbonds are required to be furnished at the time of income tax filing
  • You also need to report details of the income earned from your deposit of your post office at the time of tax filing.

Things To Do Before E Filing Income Tax Returns:

  • You may easily fill in the income tax return form online and upload the XML on Income Tax Department’s official website( IncomeTaxIndiaeFiling.gov.in)
  • Prepare your ITR 1 form online and submit it. 

Steps for E Filing Income Tax Online:

The first step in e filing income tax is to log on to www[dot]IncomeTaxIndiaeFiling[dot]gov[dot]in. Then, you’ll need to register on this website.

  • You need to fill in your Permanent Account Number (PAN) as your user ID.
  • Look at your Form 26AS or tax credit statement. The TDS according to your Form 16 must match with the ones in Form 26AS.
  • The next step for e filing income tax returns online is to click on your e filing income tax return form and then select the financial year.
  • The next step is to download an ITR form from the official IT e filing website, which is appropriate as per your earnings. In case the exempt income of an individual exceeds Rs. 5,000, ITR-2 will be the suitable form. (If the related form is ITR-1 or ITR 4S, then the process can be completed on the web portal, by making use of the 'Quick e-file ITR' link.
  • Open excel utility (software for return preparation) and fill the form by referring Form 16 to enter all the details.
  • Click on the 'calculate tax' tab so as to check the tax payable sum.
  • Pay tax (if valid) and fill in the details of the challan.
  • Click on the 'validate' tab in order to confirm the authenticity of the data filled in the worksheet.
  • Make an XML file and then save it on your computer.
  • Look for 'upload return' on the online income tax filing panel of the portal and upload the XML file that you saved.
  • You will get a pop-up on your screen. This will ask you to sign in the file digitally. Select ‘Yes’ if you have got a digital signature and if not, then select 'No'.
  • After this, it will generate an acknowledgement form, ITR Verification (ITR-V). These forms can be downloaded.
  • You need to get a paper print of the form ITR-V and use blue ink to sign it.
  • You need to post this form using either an ordinary post or a speed post to Income-Tax Department-CPC, Post Bag No. 1, Electronic City Post Office, Bangalore, 560 100, Karnataka. This form must reach within 120 days of e filing income tax 

Step by Step Guide For E filing Income Tax Return (ITR) 1: 

Prepare ITR1/ITR 4S Online and then submit it.

You also have a choice to submit the ITR 1/ITR 4S forms submitting it online or by uploading XML.

  • The first step is to login into online income tax filing
  • You need to visit 'e-File' 'Prepare and Submit ITR Online'
  • Pick up the Income Tax Return Form ITR 1/ITR 4S along with the year of assessment.
  • It will ask you to fill the requisite details. After doing so you need to click on the button that says submit.
  • After submitting the details you will get to receive the details of acknowledgement.
  • Use the link in order to look or get a paper printout of acknowledgement/ITR V form.

 Things to Look For When E Filing Income Tax Returns:

  • You cannot begin with e filing income tax if you have used the same email address or mobile number for more than four taxpayers. After making required changes, you can income tax filing online. For example, in a few cases, you can file five returns, yours, mother, wife, mother-in-law and the HUF (Hindu Undivided Family) of which you are the breadwinner, the doer of the will.
  • You must keep a sharp vigil on your details that you are filling in while online tax filing. If the details mentioned in your official statements and bank documents do not match, even with a slight difference, you will not qualify for online tax filing. For example, if your name mentioned in your official statements and bank document does not match with the name in the PAN card, even with a minor difference, the portal will think that you are a different individual.
  • NRIs, i.e. Non-resident Indians, planning on efiling income tax returns are required to present both a foreign number and India number.