Income Tax Returns

An Income Tax Return (ITR) is a form that taxpayers use to report their income details and tax payments to the income tax department. There are seven different ITR forms available for ITR e filing: ITR 1 through ITR 7. The appropriate form for a taxpayer depends on various factors, including their sources of income, the total amount earned, and the type of taxpayer they are (such as individuals, Hindu Undivided Families (HUFs), companies, etc.). Each taxpayer must accurately complete and submit their income tax filing by a specified deadline to comply with tax laws

Filing income tax returns (ITR) is a crucial duty of every taxpayer in India, ensuring adherence to the nation's tax regulations. It involves detailing all sources of income, deductions, and tax liabilities for a comprehensive report to the Income Tax Department. The last date to file your Income Tax Return for the Financial Year 2023-24 (Assessment Year 2024-25) without incurring a late fee is July 31, 2024.

An income tax return is a form where taxpayers have to declare their taxable incomes from all sources, eligible deductions, and tax payments if any. This is called ITR Filing Procedure.

If you have paid more taxes than “payable”, you are entitled to Income tax refund. If the reverse is the case, you should pay remaining amount before filing your Income tax return. Cases, where more taxes have been paid beforehand, are TDS or Advance Tax paid by you. In such a scenario, you should show correct incomes and taxes in your Tax Returns.

Income tax return forms range from ITR 1 to ITR 7, used for different types of income and different types of entities. Depending on the type of forms, there are various disclosure requirements.

Filing ITR in India is completely online and paperless. There is no need for you to submit physical return at the local income tax offices. All documents, wherever necessary need to be submitted online. Income tax return is to be filed for a particular Financial Year (i.e. April to March) irrespective of Accounting Year adopted by you.

Know More: Different types of Income Tax Forms in India

Income tax returns are forms in which taxpayers file information regarding their earned income and the respective tax applicable to the Income Tax Department. With the help of an income tax form, taxpayers can easily calculate their tax liability, apply for refunds in case of tax overpayment and schedule tax payments.

There are different types of income tax return forms depending on the taxpayer's category and income type. Such forms are: ITR 1, ITR 2, ITR 3, ITR 4, ITR 5, ITR 6, and ITR 7.

However, one should be cautious before choosing a tax return form to file. Therefore, to reduce the chances of mistakes, we present this piece describing the various income tax forms and who are eligible for a particular form.

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Due Date for ITR Filing

For the Assessment Year (AY) 2024-25, the last date for an Income tax filing (Income tax returns) under section 139(1) is July 31, 2024, unless extended by the government. It's important for taxpayers to note that merely paying taxes does not fulfil all obligations; timely income tax e filing is also mandatory to avoid penalties. Starting from the financial year 2017-18, a late ITR filing fee is imposed for returns filed after the deadline.

Here's a summary of the key Income tax e-filing last dates or due dates for various categories of taxpayers for the Financial Year (FY) 2023-24:

  • ITR Filing for Individuals and Entities Not Liable for Tax Audit: Due by July 31, 2024.
  • ITR Filing for Taxpayers Under Tax Audit (excluding those involved in transfer pricing): Due by October 31, 2024.
  • ITR Filing for Taxpayers Covered Under Transfer Pricing: Due by November 30, 2024.
  • Due Date for Revised/Belated Return of Income for FY 2023-24: December 31, 2024.

Note on "ITR date extension": The Central Board of Direct Taxes (CBDT) extended the deadline for corporates to file their income tax returns for the Assessment Year (AY) 2024-25 from 31st October 2024 to 15th November 2024. This extension follows a previous change by the government, which moved the deadline for submitting tax audit reports from September 30, 2024, to October 7, 2024. It applies to taxpayers under sub-Section (1) of Section 139 of the Income-tax Act, 1961. Ensure to file your ITR before the specified due date to avoid penalties and legal complications.

Documents Required for ITR e Filing

When preparing for your e Filing of Income Tax Return in India, it's important to have all necessary documents handy to ensure a smooth and accurate submission process. Here’s a comprehensive list of the documents you may require for Income tax e filing:

General Documents for ITR filing
  • PAN (Permanent Account Number): Essential for every kind of financial transaction and tax-related activity.
  • Aadhaar (Linked to PAN): Required for verification and linking to your tax records.
  • Bank Account Details: We need to process any potential refunds or verify financial details.
Income-Related Documents
  • Salary Slips: To verify your income from employment.
  • Rent Receipts: If you are claiming House Rent Allowance (HRA).
  • Form 16: Issued by your employer, detailing the tax deducted at source on your salary.
  • Form-16A: For TDS on Income other than salary.
  • Form-16B: For TDS on the sale of the property.
  • Form-16C: For TDS on rent.
  • Form 26AS: Your tax credit statement, which shows all taxes that have been deposited against your PAN.
Deductions and exemptions-related documents
  • Interest Certificates: These are from banks and post offices for savings accounts and fixed deposits.
  • Home Loan Details: If you're claiming deductions on home loan interest.
  • Proof of Tax-Saving Instruments: Includes life insurance, health insurance, Public Provident Fund (PPF), National Savings Certificates (NSC), ELSS mutual funds, etc.
  • Income from Capital Gains: Documents related to the sale of assets like stocks or property.
  • Rental Income: Lease agreements and rent receipts if you have rental property.
  • Foreign Income and Dividend Income Proofs: Documents verifying income from foreign sources and dividends.

Penalty for Late Filing Income Tax Returns

When filing your Income Tax Return (ITR), it's crucial to meet the Income tax return filing last date to avoid penalties and maximise benefits:

  • Interest: If you miss the deadline for Income tax filing, under Section 234A, you will incur an interest charge of 1% per month or part thereof on any unpaid tax amount.
  • Late Fee: As stipulated by Section 234F, a late filing fee is imposed if you missed the last date to file ITR. The fee is Rs. 5,000 but is reduced to Rs. 1,000 for those with a total income below Rs. 5 lakh.
  • Loss Adjustment: Timely income tax e filing allows you to carry forward losses from investments or business activities, which can be offset against future income tax liabilities. Failing to file your Income tax returns on time results in forfeiting this benefit.

Procedure for eFiling of ITR in India

Income tax e filing in India can be accomplished through two primary methods: offline to online and entirely online. Here’s a step-by-step guide on how to file income tax return online and offline to online:

eFiling ITR Offline to Online Method:
  • Download the Appropriate ITR Form: Visit the official Income Tax Department website. Based on your income sources and category, download the correct ITR form using the Excel Utility or Java Utility available on the portal.
  • Fill Out the Form Offline: After downloading, fill out the form on your computer. This allows you to work through your tax details at your own pace without needing an internet connection.
  • Save the Form in XML Format: Once completed, save the form in XML format, as this is the required format for uploading to the e-filing portal.
  • Upload the XML File to the e-Filing Portal: Log into your account on the e-filing portal. Navigate to the appropriate section to upload the XML file and submit your ITR.
e-Filing of Income Tax Returns Online

E-filing your Income Tax Returns (ITR) is a straightforward process once you've registered at the Income Tax e filing portal and gathered all necessary documents. Follow these steps for your e file Income tax return efficiently:

Step 1: Log in to the Portal

Visit the official Income Tax Department e-filing website and click on “Login” at the top right corner.

Step 2: Enter Login Credentials

Input your registered username (usually your PAN) and password in the designated fields. Be mindful of case sensitivity in the password. Click “Continue” to proceed.

Step 3: Access E-Filing Services

After logging in, navigate to the “e-File” tab on the dashboard and select “File Income Tax Return” from the dropdown menu to start e file income tax return.

Step 4: Choose the Assessment Year and Filing Mode

On the “File Income Tax Return” page, specify the Assessment Year (AY) for the return you are filing. For example, AY 2024-25 corresponds to income earned from April 1st, 2023, to March 31st, 2024.

Select “Online” as the Mode of Filing. An offline option using the “Income Tax Utility” is available for certain scenarios.

Step 5: Select Taxpayer Category

Indicate whether you are filing as an Individual, Hindu Undivided Family (HUF), or other entity types. Click “Continue” after making your selection.

Step 6: Choose the Right ITR Form

Based on your taxpayer category and income details, the portal will suggest appropriate ITR forms. Choose the one that matches your income sources:

  • ITR-1 (Sahaj) for salaried individuals with income from salary, one house property, and other sources such as interest.
  • ITR-2 for individuals and HUFs with capital gains or foreign income, but no income from business/profession.
  • ITR-4 (Sugam) for individuals with business income and presumptive income from professions.
Step 7: Reason for ITR Filing

Select your reason for income tax e filing, which might include regular assessment, claiming a refund, or filing a revised return.

Step 8: Review and Edit Pre-Filled Information

The portal may pre-fill certain sections based on data from employers, banks, etc. Verify each entry for accuracy and edit any incorrect information before proceeding.

Step 9: Review and Confirm ITR Return Details

Review a detailed display of your ITR, including income, deductions, and tax liability. Ensure all data is correct before moving forward.

Step 10: Make Tax Payment

If applicable, settle any tax dues via the e-payment gateway. Select your bank and preferred payment method, such as net banking or debit/credit card.

e-verify your return

After you have done your the ITR e filing, the next crucial step is to e-verify your return. This is an essential part of the ITR e filing process, as it confirms the authenticity of your submission to the Income Tax Department. You can e-verify your ITR in several ways:

  • Electronic Verification Code (EVC): Generated through your bank account, Demat account, or registered mobile number and email.
  • Aadhar OTP: A one-time password sent to the mobile number linked to your Aadhaar, used for verification.
  • Sending a Signed ITR-V: If electronic verification isn’t possible, you can mail a signed copy of ITR-V (Income Tax Return Verification) form through normal or speed post to the Centralized Processing Center, Income Tax Department in Bengaluru within 120 days from the date of filing.

Common Mistakes While e-Filing Income Tax

Your e Filing of Income Tax Return (ITR) in India, several common mistakes can complicate the process or even lead to penalties. Being aware of these pitfalls can help ensure a smooth ITR e filing experience:

  • Choosing the Wrong Tax Form: Different ITR forms cater to various income sources and taxpayer statuses. It's crucial to select the correct income tax return form based on your income types, as specified on the Income Tax Department's website.
  • Incorrect PAN or Personal Information: Errors in entering your PAN, name, address, or date of birth can lead to the rejection or delayed processing of your tax return.
  • Incorrect Bank Account Details: Providing wrong bank details can delay your ITR refund. Make sure to accurately enter your bank account number, IFSC code, and other relevant information.
  • Not Claiming All Eligible Deductions: Many taxpayers miss out on reducing their tax liabilities by not claiming all eligible deductions for savings, investments, and certain expenses allowed under The Income Tax Act 1961.
  • Failing to Disclose All Income Sources: All income earned during the year must be disclosed. Failure to report all income sources can lead to penalties and is considered tax evasion.
  • Not E-verifying the Return: After filing your ITR, it must be verified electronically within the prescribed time limit. An unverified return is treated as if it has not been filed at all.
  • Filing After the Deadline: Late submissions can incur penalties and fines. It's important to file your return before the due date to avoid these additional costs.
  • Omitting Capital Gains from Mutual Funds: Both long-term and short-term capital gains from mutual funds are taxable. Ensure these gains are reported correctly to avoid issues with the tax authorities.

    • By avoiding these errors, you can ensure that your ITR filing process is error-free and compliant with the tax laws, ultimately securing your peace of mind. At Finxurance, our experts can help you navigate the complexities of the Income-tax efiling process with ease.

FAQs

Frequently Asks Questions

It’s a prescribed form through which a person can furnish the details of his /her income earned through different sources of income and taxes paid for the relevant financial year to the Income Tax Department.
Yes, you are required to file your income tax return if your income exceeds Rs. 2,50,000 in a Financial Year i.e. the basic exemption limit without giving effects to any type of deductions/investments.
Yes, even if your employer deducts and deposits your TDS on regular and timely basis, you are still required to file your tax return if your income exceeds Rs. 2,50,000. This helps in determining any dues or eligibility for refunds.

E-Filing is mandatory in certain cases. For example, if your total income exceeds Rs. 5,00,000 p.a. or if you want to claim refund then you are compulsorily required to e-file your Income Tax Return. It is a much simpler process than filing a paper return and also your refunds are processed faster if your return has been E-Filed.

You can yourself e-file your return with us faster, secure and simpler by using our website. It is a simple, secure, and fully automated platform for you to file your Income Tax Return.

  • Login to the Department e-filing website
  • Select e-filed Returns/Forms from My Account dropdown.
  • Click on “Click here to view your returns pending for e-verification”
  • Select the AY you want to e-verify your return for and then you can choose from the given three options available there to e-verify your return.

Don’t worry!! Our expert will help you to choose a best suitable plan for you. Get in touch with our team to get all your queries resolved. Write to us at info@finxurance.com or call us @+91 9643 203 209.