Income Tax e-Filing

Income Tax e-filingThe complete process for Income Tax e-filing along with details of required documents, eligibility, etc are provided in this article below.

For salaried employees in India, filing Income Tax Returns (ITRs) is an annual obligation.

However, with the introduction of e-filing, the process has become much more convenient and hassle-free.

In this article, we will provide you with a step-by-step process of e-filing your ITR, ensuring that you can complete this task with ease and accuracy.

Introduction to Income Tax e-Filing

The Income Tax Department of India has made significant strides in digitizing the filing process, allowing taxpayers to file their returns electronically through the official Income Tax e-Filing website (https://www.incometax.gov.in).

This platform is user-friendly and accessible from anywhere, eliminating the need for physical submission of documents.

Eligibility for ITR-1: ITR-1 (SAHAJ) – Applicable for Individual

Before we get into the e-filing process, it’s essential to understand whether you are eligible to file ITR-1.

This Income Tax Return form (ITR-1) is meant for Resident individuals (excluding Non-Resident or Not Ordinarily Resident individuals) whose Total Income comes from the following sources and does not exceed ₹50 lakh. Other eligibility criteria are as follows:

  • Salary/Pension Income
  • Income from One House Property
  • Income from Other Sources (such as Interest, Family Pension, Dividends, etc.)
  • Agricultural Income up to ₹5,000

ITR-1 cannot be used by individuals who fall under any of the following categories:

  1. Hold a directorship in a company.
  2. Possess unlisted equity shares at any time during the previous year.
  3. Own assets (including financial interests in any entity) outside India.
  4. Hold signing authority in any account located outside India.
  5. Earn income from any source outside India.
  6. Have tax deducted under section 194N.
  7. Have deferred tax payment or deduction on Employee Stock Ownership Plan (ESOP).
  8. Carry forward any loss under any head of income.
  9. Have a total income exceeding Rs. 50 lakhs.

Documents Required for e-Filing

Before you begin the e-filing process, ensure that you have the following documents readily available:

  • Form 16: This document is issued by your employer and contains details of your salary, allowances, and the tax deducted at source (TDS).
  • Form 26AS: This form provides a comprehensive record of all the TDS deductions made against your Permanent Account Number (PAN).
  • Annual Information Statement (AIS): The AIS is a consolidated statement that includes information about your income from various sources, such as salary, interest, and other income.
  • Bank statements: You may need to refer to your bank statements to verify interest income or any other income sources.
  • Proof of investments and deductions: Gather documents related to your investments, such as Provident Fund (PF), Public Provident Fund (PPF), life insurance premiums, home loan repayment details, and any other deductions you wish to claim.

Income Tax e-Filing: Complete Process

Step-by-Step Guide to e-Filing ITR-1 is provided below:

Step 1: Visit the Income Tax e-Filing Website (https://www.incometax.gov.in). Click on the Login option, available on the main page using your PAN (Permanent Account Number) as the user ID and password generated during the registration process.

Step 2: It will lead you to your Dashboard, here, click on e-File > Income Tax Returns > File Income Tax Return.

06

Note:

  • If your Permanent Account Number (PAN) is not functional, you will receive a warning message indicating that your PAN is inoperative due to it not being linked with your Aadhaar number.
  • You have the option to click on the “Link Now” button to establish a connection between your PAN and Aadhaar. Alternatively, if you wish to proceed without linking, you can click “Continue.

07

Step 3: Now, select Assessment Year as 2024–25 and Mode of filling as Online, then click Continue.

08

Step 4:  In case you have already filled the Income Tax Return and it is pending for submission, then click on the Resume Filing option. In case you want to start filing a fresh return, click on Start New Filing option.

09

Step 5: Select your Status as applicable to you which could be Individual, HUL, or Others, and click Continue to proceed further.

10

Step 6: Here, you will have two options to select the type of Income Tax Return:

•    If you know which ITR to file, select the ITR form, which is ITR-1 and ITR-4; else
•  If you’re uncertain about which Income Tax Return (ITR) form is appropriate for your situation, you can choose the option “Help me decide which ITR Form to file” and click “Proceed.” By doing so, the system will guide you through a process to determine the correct ITR form suitable for your circumstances. Once the appropriate form has been identified, you can then proceed with filing your ITR.

11

Note: 

  • If you’re unsure about which Income Tax Return (ITR) form or schedules apply to your specific situation or income and deductions, don’t worry. The system will ask you a series of questions, and your responses will help guide you in determining the correct ITR and schedules relevant to your case. This process will assist you in filing your ITR accurately and without errors.
  • However, if you already know the ITR form and schedules that are applicable to your income and deduction details, you can skip the questions and proceed directly with filing your return.

Step 7: Once you have selected the ITR applicable to you, carefully note the list of documents needed and click Let’s Get Started. Noting down the list of documents will help you file faster.
12

Step 8: Select the appropriate checkbox applicable to you regarding the reason for filing ITR and then click on Continue option.

13

Step 9: To select the new tax regime, navigate to the “Personal Information” section and choose “Yes” for that option. Be aware that certain deductions and exemptions are unavailable under the new tax regime, as indicated by the pop-up notification. Carefully review the pre-filled data and make any necessary edits. Input any remaining or additional data if required. Once you have completed each section, click “Confirm” to proceed.

20

Step 9a: In the “Personal Information” section, verify and update your personal details, such as address, nature of employment, and bank account details for refund purposes.

Step 9b: Move to the “Gross Total Income” section and enter your salary income as per Form 16. If your employer has not included any allowances or exemptions, you can add them here, provided you have supporting documents.

Step 9c:Total Deductions” section is crucial for minimizing your taxable income. Here, you can claim deductions under various sections, such as Section 80C (investments in PF, PPF, life insurance premiums, etc.), Section 80D (health insurance premiums), Section 80TTA (interest on savings bank accounts), and others.

Step 9d: After entering all your income and deduction details, the system will calculate your total taxable income and tax liability. Review the calculations carefully and ensure accuracy.

21

22

Step 10: Here you have to enter/ Edit your income and total deductions details in the different sections. After completing all the information and confirming all the sections of the form, click on the Proceed option.

23

Step 10a: In case there is a tax liability

Once you click on “Total Tax Liability,” you will see a summary of your tax computation based on the details you provided. If the computation shows that you have a tax liability to pay, you will be presented with the options “Pay Now” and “Pay Later” at the bottom of the page.

Income Tax e-filing

Note:

  • It is recommended to use the “Pay Now” option.
  • If you choose to “Pay Later,” you can make the payment after filing your Income Tax Return. However, there is a risk of being considered a taxpayer in default, and you may be liable to pay interest on the tax amount payable.

Step 10b:If there is no tax liability (No Demand/No Refund) or if you are eligible for a Refund, click “Preview Return“. If the tax computation shows no tax liability payable, or if you are owed a refund, you will be directed to the “Preview and Submit Your Return” page.

Income Tax e-filing

Step 11: If you click on Pay Now, you will be redirected to e-pay Tax service. Click Continue.

Income Tax e-filing

Note:

  • After clicking “Continue,” you will be taken to the “e-Pay Tax” page on the portal to make your tax payment. Refer to the e-Pay Tax user manuals for more detailed instructions on completing the payment process.

Step 12: Upon successful payment through the e-Filing portal, a confirmation message will be displayed. Click “Back to Return Filing” to proceed with completing and submitting your Income Tax Return (ITR).

Income Tax e-filing

Step 13: Now, click on Preview Return.

28

Step 14: On the Preview and Submit Your Return page, select the declaration checkbox and click Proceed to Preview.

Income Tax e-filing

Note: If you did not involve a tax return preparer (TRP) in preparing your return, you can leave the text boxes related to TRP information blank.

Step 15: Now preview your return and click on Proceed to Validation.

Income Tax e-filing

Step 16:After validating your return, on the “Preview and Submit Your Return” page, click “Proceed to Verification.”

16

Note:

If you are shown a list of errors in your return, you need to go back to the form and correct those errors. If there are no errors, you can proceed to e-Verify your return by clicking “Proceed to Verification.

Step 17: On the Complete your Verification pageselect your preferred option and click Continue.

It is mandatory to verify your return, and e-Verification (the recommended option being “e-Verify Now”) is the easiest way to verify your Income Tax Return (ITR). E-Verification is quick, paperless, and safer than sending a physically signed ITR-V to the Central Processing Centre (CPC) via speed post.

Income Tax e-filing

Note:

If your Permanent Account Number (PAN) is inoperative, you will see a warning pop-up message stating that the taxpayer’s PAN is inoperative as it is not linked with Aadhaar.

You can link your PAN with Aadhaar by clicking the “Link Now” option, otherwise click “Continue.”

17

Note: If you select “e-Verify Later”, you can submit your return. However, you will be required to verify your return within 30 days of filing your Income Tax Return (ITR).

Step 18: On the e-Verify page, select the option through which you want to e-Verify your return, and then click “Continue.”

Note:

  • Refer to the “How to e-Verify” user manual to learn more about the e-Verification process.
  • If you select “Verify via ITR-V“, you need to send a physically signed copy of your ITR-V to the Centralized Processing Center, Income Tax Department, Bengaluru 560500 by speed post within 30 days.
  • Please ensure you have pre-validated your bank account so that any refunds due can be credited directly to your bank account.
  • Refer to the “My Bank Account” user manual for more information on validating your bank account details.

After you successfully e-Verify your return, a confirmation message will be displayed along with the Transaction ID and acknowledgment number. You will also receive a confirmation message on the mobile number and email ID registered with the e-filing portal.

18

Related Articles:

Tips and Strategies for Effective Tax Planning

While e-filing your ITR is an important step, it’s important to remember that effective tax planning should start at the beginning of the financial year. Here are some tips and strategies to help you maximize your tax savings:

  • Declare all income sources to your employer: If you have additional income sources, such as rental income or freelancing income, declare them to your employer. This will ensure that the correct TDS is deducted, and you won’t face any interest or penalty for late payment of taxes.
  • Submit proofs of investments and deductions: Provide your employer with proof of your investments and deductions, such as PF contributions, life insurance premiums, home loan repayment details, and medical insurance premiums. This will ensure that your Form 16 reflects the accurate deductions, and you won’t have to claim them separately during e-filing.
  • Attend tax planning workshops: Participate in tax planning workshops or seminars to gain a better understanding of the latest tax rules, deductions, and investment options. This knowledge will help you make informed decisions and maximize your tax savings.
  • Seek professional advice: If you have a complex financial situation or are unsure about your tax obligations, it’s advisable to seek professional advice from a qualified tax consultant or chartered accountant.

Conclusion

E-filing your Income Tax Return has become a convenient and straightforward process, thanks to the efforts of the Income Tax Department. By following the step-by-step guide provided in this article, you can ensure a hassle-free and accurate filing experience.

Remember, effective tax planning is an ongoing process that should start at the beginning of the financial year. By staying informed, seeking professional advice, and implementing the right strategies, you can minimize your tax liability and maximize your savings.

Leave a Reply