E-Filing of Income Tax Returns Online

Income tax is the largest tax in the country and the main source of revenue for the Government of the country. Income tax is paid by both individuals and organisations against the income which may have been generated from salary, dividends, capital gains, interest rate from savings, rent payment, pension, insurance commission, fees for professional services etc.

The income tax department has set slabs and if one falls under them, they are liable to pay the income tax. The tax is calculated on the income generated on the previous year and is paid in the current assessment year(AY).

What is Income Tax Return?

An income tax return is one important document which encompasses details about one’s income and tax paid on the income. It acts as proof that tax has been paid.

Every earning individual is required to pay the income tax if their income falls in the said income tax slab. Failure of filing the ITR and depositing the tax can have heavy penalties and serious legal consequences.

As per the Income Tax Act, if the total income of the individual is more than Rs. 2.5 lacks, then he/she has to file the ITR. The maximum limit for senior citizens whose age is less than 60 is Rs. 3 lakhs. And the limit for the senior citizens above 80 years is Rs. 5 lakhs. If however, one has paid more taxes than the liability, then with Income Tax Return, they can get the refund of the extra amount paid as tax. The taxpayers should file their ITR by 31st July which happens to be the due date. If however, the income requires auditing, then the return should be filed by 30th September.

On the basis of an individual’s income type, the forms for filing an Income tax return are provided by the government.

Return of Income

It is the form which contains information about the income and tax paid by individual or organisation in the financial year. Based on one’s income, there are different types of forms viz. ITR 1 to ITR 7, ITR 4S, and ITR-V. These forms can be downloaded from Income tax department website.

Why is Filing of Income Tax Return Necessary?

Income tax provides the needed money for nation building and providing the required infrastructure to the citizens and people living in the country. Filing of income tax return is mandatory for

  • the citizens who fall into the income tax slab
  • any resident acting as a signatory in the foreign account
  • individuals seeking a tax refund
  • individuals seeking loans/visa approvals
  • individuals getting income from property which is used as educational purpose, religious purpose,  medical institutions, charitable trust,  infrastructure debt funds, NGO, trade union etc.

Anyone who incurs income from Indian resources is eligible to file the income tax return.

Income Tax Return Forms

On the basis of one’s income, there are different types of income tax return forms which are made available by the Government of India. These forms are:

  • ITR-1:  This income tax form is for individuals getting income from salary, pension, rent, interest or other sources. The form is also called as SAHAJ. It doesn’t include the income from lottery or horse racing.
  • ITR-2: This form is for individuals and HUFs who earn additional income other than business and professional gains.
  • ITR-3: This income tax form is for individuals whose income comes from professional and business gains.
  • ITR-4: This income tax form is for individuals whose income comes from the business/ professional proprietorship.
  • ITR-4S: This form is meant for individuals seeking a presumptive taxation scheme as mentioned in Section 44AD, 44ADA, 44AE. This form is also called SUGAM.
  • ITR-5: This income tax form is designed for firms, co-operative society, BOI, LLP, AOP etc. It is not meant for entities filing ITR under section 139 (4A), (4B), 4(C) or 4(D). It includes colleges, political parties, institutes, trusts etc.
  • ITR-6: This income tax return form is for those companies apart from the ones which stand eligible for claim of tax deduction or exemption under Section 11 of the Income Tax Act.
  • ITR-7: This form is for those entities who file ITR under section 139 (4A), (4B), 4(C) or 4(D).
  • ITR-V: This form is the acknowledgement /verification form which is received by individuals once they have filed their income tax return.

Which ITR Should I File?

It is very important to file the ITR using the correct ITR form. Keep the following pointers:

  • ITR-1 form is not meant for individuals with income greater than 50 lakhs, taxable capital gains, foreign assets, agricultural income more than Rs.5000.
  • ITR-2 is not meant for individuals in business or profession. Those people should file ITR using form ITR-3 and ITR-4.
  • ITR-3 is for those businesses opting for presumptive tax scheme whose turnover exceeds Rs.2 crore.
  • ITR-7 is for those who file an income tax return under section 139 (4A).

Benefits of Filing Income Tax Return Online

Filing your ITR online has various benefits.

  • One can file the income tax return on time and hence avoid any penalty or interests.
  • One can avail loans easily as the taxpayer gets an acknowledgement form which can be used as financial proof.
  • It enhances your credibility.
  • Fast and easy access to your financial history.
  • Online ITR filing makes it convenient to check and correct any detail in case there is any discrepancy.

Process of E-Filing ITR offline

To file the ITR offline,

  1. Visit the Income Tax Department website and select ‘e-filing’ option.
  2. You will be redirected to a webpage. Choose the suitable ITR form
  3. You can download the form in Excel or in Java utility format.

In the case of Excel,

  • Fill the form.
  • Check the details and calculate the taxes.
  • Click on ‘Generate XML’. Save the form.
  • Upload the form on Income tax e-filing website.

In case of Java utility,

  • Open the form. Click Prefill.
  • Fill details of your ID, DOB, password and address.
  • Enter the income details and calculate taxes.
  • Save the file in XML format.
  • Validate and click on Submit.

The following documents are required to be attached along with the form:

  • Bank statement
  • Previous year’s ITR
  • TDS certificate
  • Deduction of Savings certificate
  • Interest statements
  • Balance sheet
  • Profit and loss statement etc.

Process of E-Filing ITR Online

Before e-filing the ITR online keep your bank statement, TDS certificate, deduction or saving’s certificate, tax credit statements and all other relevant documents handy.

  1. Login to the Income Tax Department website. Use your PAN card as the User ID for registration.
  2. Go to the Downloads menu and select the relevant ITR forms. Choose the Assessment year. Either download the form or fill it online using the ‘Quick e-file ITR link’.
  3. Using the Return preparation software, fill in the form with details as given in Form 16.
  4. Click on ‘calculate tax’ button.
  5. Validate the information.
  6. Generate XML file. Save it.
  7. Go to ‘upload return link’ and upload the XML file.
  8. With e-file success, you will receive the ITR- V form.
  9. Sign the ITR-V acknowledgement form. Send it to the nearest income tax office within 120 days of filing the ITR.

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