e Filing Income Tax
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Updated date : 27 December 2019
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.
Income Tax E-File: An Introduction
Filing income tax return on time is a sign of a responsible citizen. Even the government has made it compulsory for the individuals to pay the taxes who earn up to a specific limit annually. Failing which will lead to the penalties as per the income tax law.
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.
Step-wise Process of Filing Income Tax Return
Mentioned below are the steps to be followed to ensure a successful e filing income tax return.
STEP 1- Register yourself
The process of e filing income tax can’t be initiated without registering yourself on the website of the Income Tax department. To do so, visit the official website- incometaxindiaefiling.gov.in and complete the formalities.
You will have to provide your PAN number and date of birth. In order to log in, you just need to set your password and your user ID will be your PAN number.
STEP 2- Select a Way you want to e-file your ITR
You can file your income tax return in two ways.
- By downloading the ITR form from ‘Download’ section and filling in all the details. Then, you need to upload the duly filled form on the website.
- By logging on to gov.in and filling the form online by selecting the e-file option.
STEP 3- Select the Applicable form
You need to select the applicable form from the following list.
- ITR-1- For individuals earning a salary, income from property, pension or sources other than lottery.
- ITR-2- For individuals who are earning income from capital gains.
- ITR 2A- For individuals who own more than one house with zero capital gains.
- ITR 3, 4 and 4S- For business owners and professionals.
- ITR 5– For firms, BOIs, LLP, and AOPs.
- ITR 6– For companies that don’t claim tax exemption under Section 11 of the Income Tax Act, 1961.
- ITR 7–For individuals and companies required to provide tax return under Section 139(4F)/ Section 139(4E)/ Section 139(4D)/ Section 139(4C)/ Section 139(4B)/ Section 139(4A) of the Income Tax Act, 1961
STEP 4- Keep the Required Documents Handy
In order to complete the process of e filling income tax return, keep all the required documents handy. You will need the documents mentioned below.
- PAN number
- Form 16
- TDS certificate
- Investment details (if any)
- Insurance and home loan documents(if any)
- Form 26AS
If you earn more than INR 50 Lakh, you need to fill in an additional column called-‘AL” or Assets and Liabilities. You need to provide the value of your assets and liabilities and declare the cost of your assets.
STEP 5- Fill and Upload the Return Form
You can fill the form either offline as well as online. For offline mode, you need to download the form and fill in the details. After filling the form, click on ‘Generate XML’. Next, go to the official website and click on the 'upload XML' button.
First, you need to log on to the website and upload the saved XML file and click on ‘submit’ button.
STEP 6- Verify ITR V
When you submit your ITR form, an acknowledgment number will be generated. If the return is submitted through the Digital Signature, you need to save the number. If the return is submitted without a digital signature, ITR V is generated and the same will be mailed to the registered e-mail address.
The ITR filing process is complete after your ITR V is verified. You can verify it online or you can mail the signed ITR V to the Income Tax Department Centralized Processing Centre, Bangalore within 120 days from filing the return.
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 saving bonds 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.
Why Should You File Income Tax Return?
There is a conception among most of the people that paying income tax or income tax efile is voluntary. However, this is a wrong perspective. Filing income tax return is a social duty that one has to perform compulsorily. Moreover, income tax efile is the easiest and the legitimate way to justify your income. The main reasons to file an income tax return are:
Filing Income Returns is Mandatory
Tax filing is a mandatory activity and by doing that you can justify your income. Even if you don’t come to the slab, it may be ideal to go for income tax efile. Proof of tax return is useful in getting a loan, registration of immovable items, etc.
It Proves that You’re responsible Enough
As per the government rule, an individual with a specific income annually should file income tax return within a pre-specific due date. Income tax efile is a sign that you’re responsible. Moreover, it also helps the individuals and businesses in following transactions since they have the exact proof of the source of their income.
Banks or Financial Institutions May Ask for Tax Return Proof
If you are supposed to buy a new home and want to take a loan, maintaining a steady record of tax returns is advised. Most of the banks or home loan companies will ask for the same. In fact, you can show the tax-return proof of filing tax for your spouse as well, in case you’re buying the property jointly. Similarly, credit card companies may insist you present income tax efile documents to sanction a card. Financial institutions also may ask you to provide the past few years tax return proofs to initiate the transactions.
It Helps in Revised Returns
In case the taxpayer hasn’t filed the original return, filing a revised return will be difficult when he/she actually needs to. Moreover, as per the Income Tax Act of India, a penalty of Rs. 5,000 is charged for not fillingthe taxes. So, when income tax efile or manual filing is the mandatory activity, it could pose legal implications,if one is not paying income tax on time, especially if a revised return is to be filed in future.
How to e-file your Income Tax Return?
When you electronically file your income tax return, it is called Income tax e-filing. You can seek professional help in this regard or do it yourself as per your convenience. The most convenient way to file your returns is by registering on the official website of the IT Department. As the due date for filing income tax return for the fiscal year 2017-18 is August 31st, most of the taxpayers are running from pillar to post.
Who Should File Income Tax Returns Online?
Filing income tax return online is the easiest way to file your income tax return. E filing income tax can be done by:
- Individual with total annual income of INR 5 Lakh and above.
- HUF resident/individual with assets located abroad.
- A resident who has signing authority in an account abroad.
- A firm (which is not a part of the provision of section 44AB)/other bodies such as AOP, BOI, Cooperative Society and Local Authority (ITR 5), Artificial Juridical Person.
- An individual who claims tax benefit under Section 90 or Section 90A or tax deductions under Section 91 of the Income Tax Act, 1961.
- An individual is required to file returns under Section139 (4B) (ITR 7).
- All companies.
Things to consider while e-filing Your Tax Return
While e filling your tax returns, you should consider the things mentioned below:
- The first thing to consider while e filing income tax return is to register yourself on the official website of income tax department. For obtaining a digital signature, log on to the IT (Income Tax) website, navigate through to ‘Profile Settings and click on ‘Register Digital Signature Certificate’.
- In case you are e filing income tax return without Digital Signature Certificate, an ITR V form will be generated. You need to take a print out of the form, signed and mail to the Income Tax Department Centralized Processing Centre, Bengaluru through ordinary post or speed post. This should be done within 120 days from the date of e filing income tax
Income tax efiling Frequently Asked Questions:
1. What happens if I don't register?
Ans- In case, the taxpayer doesn’t register themselves to file for income tax return, then they may receive a notice from Income Tax Department regarding payment of income tax or they will fail to receive the deducted tax amount i.e. TDS refund. In case, the taxpayer fails to pay their tax even after receiving the notice from income tax department then they will be charged a penalty for not repaying the tax along with a penalty of 1% per month of total due tax.
2. What are the Different Modes of Filing Income Tax Return?
Ans- The taxpayers can file ITR form with the Income Tax Department in the following ways:
- By filing the return in a paper form.
- By e-filing the return under digital signature.
- By transferring data in e-filing return under electronic verification code.
- By transferring data in e-filing return and subsequently submitting the verification of ITR-V form.
3. How important it is to attach any document along with the Income Tax return Form?
Ans- Income tax return form does not require any attachment of documents like investment proof, TDS certificate, etc. whether filed online or offline. However, it is important for taxpayers to keep handy the documents in case the tax authority demand for the same in a situation like inquiry, assessment, etc.
4. What is the difference between e-payment and e-filing?
Ans- E-payment is the online process of tax payment i.e. through debit/credit card and net banking and e-filing is the procedure of electronically furnishing income tax return. Using the process of e-filing or e-payment, the taxpayers can easily furnish income tax return and discharge the obligations of payment.
5. If I have paid excess tax, how and when will it be refunded to me?
Ans- The individuals can claim a refund for excess tax by filing the Income Tax Return. The refunded amount will be credited to the bank account of the taxpayer through the process of ECS transfer.
6. What are the benefits of filing income tax return?
Ans-Filing income tax return is obligatory for every citizen as it is proof that you have paid your income tax and has contributed to the development of the nation. There are various benefits of filing income tax return.
- ITR filing helps individual for easy loan approval.
- It helps in quick visa processing.
- The individual can claim for a tax refund by filing income tax return.
- ITR can be used as income proof and address proof.
7. Can Chartered Accountant (CA) file ITR on behalf of the company?
Ans- No, only the person who is authorized by the company to file ITR, can e-file tax return of the company.
8. Can Chartered Accountant (CA) file ITR on behalf of the taxpayer?
Ans- Yes, a chartered accountant can file income tax return on behalf of the taxpayers.
9. Can I File ITR after the due date?
Ans- yes, once can file income tax return after the due date. In case, the individual fails to file the ITR within the due date then they have the option to file a belated return under section 139(4) before the completion of the assessment year.
10. How to download an ITR form from the Income-Tax Department online e-filing portal?
Ans- The process to download ITR form online from the income tax department is very simple and hassle-free. Let’s take a look at the steps to download ITR form.
Step1: Visit the official website of Income Tax Department i.e. www.incometaxindiafiling[dot]gov.in
Step2: Click on the option of ITRs appearing under the download head.
Step3: Choose the assessment year as 2017-2018
Step4: Download the appropriate ITR form by clicking on the download option.
The taxpayers can choose java or excel utility depending on their suitability of using the respective application.
11. What are the details of income-tax e-filing helpline?
Ans- The details of income tax e-filing helpline are:
e-filing of Income Tax Return- Customer care no- 180042500025(toll-free)/+918026500025
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