Income Tax Return – Everything that You Should Know


Filing income tax returns is mandatory for any Assessee whether salaried or owning his own business. The income tax regulations change every year and tax payers may file their returns based on the latest regulations declared for the current Assessment Year.


Whether you are the first-time tax payer or doing it for years, you will get answers to all your queries here.



 What is income tax?

Income tax is the government tax levied on the income generated in the financial year, which may come under the local jurisdiction. Both individuals and businesses need to pay income tax as stated by the law. Income tax returns are filed to calculate the applicable tax in the financial year and know whether you need to pay tax or claim the refund from the TDS deducted during the financial year. The tax collected on the income is then used by the government for development activities.



 Why should you file Income Tax Return (ITR)?

ITR is believed to be obligatory only for those who fall under the income tax bracket and this is the reason why many of those having low income or in the beginning of their career would avoid filing returns as they consider it is time consuming and not very useful. However, ITR is not just an obligation or extra work levied by the government. It has many benefits other than income tax calculation. If you are thinking that keeping your income confidential or avoiding this tedious job of return filing will benefit you then here are some more reasons to file your returns.


  •  Generation of PAN – Your PAN is generated once you start filing ITR. PAN is the Permanent Account Number that is mandatory for filing ITR and for many other financial transactions. You would require PAN for opening a bank account or even while making investments.

  •  Globally accepted income proof – ITR is globally accepted income proof. This proof can be used for higher education, employment, or any other transaction where income proof is required.

  •  Important document for loan – To avail any type of loan, you would require income proof. Regular filing of tax would increase your credibility and make the loan process speedier. You will have wide range of loan options with proper income proof in the form of ITR.

  •  Mandatory to claim refund – TDS is deducted by the employer and even by the banker if interest earning exceeds certain value. If you are not liable to pay income tax then you must claim the refund, which is possible only with ITR.


 Who all must file the ITR?

Any person who earns income either directly or indirectly may file ITR. The person may be involved in any of the below mentioned business or job.

  •  Individual (Salaried Person)
  •  HUF
  •  Individual (Businessman)
  •  Companies
  •  Freelancers
  •  Firm
  •  SME
  •  Retired person

and any person that is getting income from any source.



 Where to file Return?

Return can be filed online on government income tax filing website. Please follow the link below – https://incometaxindiaefiling.gov.in/

 Things Required to File the ITR

To make e-filing of ITR easy, keep the following things ready for reference –

  •  Form 16 – It can be uploaded online via DSC to enter the data of TDS and income generated during the given financial year. The values here would be used for e-filing in case the details are not updated online on the e-filing website.
  •  TDS data
  •  Employer and employee Permanent Account Number (PAN)
  •  Employer TAN
  •  Bank account information
  •  Tax payment Details like Challan.

You won’t be attaching these documents while filing ITR, but you will require these documents for reference.

 How to file ITR?

Following are the steps to file ITR –

 Step 1 – Prepare Income Tax Return

Here, you would be required to enter all the income and deduction details. You can do it in various ways.

  •  Manual preparation of ITR. This is quite a tedious job and may call for lots of patience and dedication. Earlier this process was carried out manually when there were no online websites available for the same.
  •  Online ITR filing without software is also possible but then you will have to carry out the calculations and enter the data properly for error-free ITR filing. The steps to file returns online without using the software are –
       Create a LOGIN ID and Password on the Govt. e-filing website.
       Log in with the valid details.
       Upload the required documents.
       Find your related segment and then enter the details.
       Attach the signature file.
       E-verify the details.
       And finally submit the request.
       If something goes wrong, then query is generated that you should address with appropriate details.
  •  If you find the above process lengthy and tedious, then hire a professional to do it for you. However, this will be an expensive option.
  •  Another option is to use income tax software that makes the process easier and is also an affordable option.

 Step 2 – File ITR

Once ITR is prepared using either of the above methods, file it by following the process mentioned here at “How to File ITR Return Online?”


 Important Things to Know About ITR

 1. What is ITR XML File in income tax?

When returns are filed online, the ITR file should be formed in XML format as per DTD schema prescribed by Income Tax Department.


 2. What is DSC in income tax?

DSC stands for Digital Signature Certificate that is mandatory for the firms and individuals whose returns are to be audited under section 44 AB. This saves hassles of manually signing and sending the certificate to CPC, Bangalore. Get your ‘Digital Signature Certificate’ in 1 hour.


 3. How to download income tax return?

Login to the e-filing website. Go to View Returns/Forms option. Click acknowledgement number given along ITR-V to download the same


 4. How to revise TDS return online?

 rerequisites for furnishing a TDS revised return.

TDS revised Return Statement can only be filed if the original return has been accepted by TIN centralise system. You can check the status of the regular statement on the TIN website by entering the TAN NO. and Provisional Receipts Number.

For revision of TDS, login to www.tin.nsdl.com or Income tax website with TAN Registration. Enter Login details. View TDS and make the amendments. Submit the form.


 5. How to file TDS correction return?

For TDS Correction return Following Steps are follow.

  •  Step 1: To prepare correction statement, first download Consolidated TDS/TCS file after login at TRACES login at www.tdscpc.gov.in
  •  Step 2: Import consolidated TDS/TCS file and Prepare the Correction statement as per the applicable Category;
  •  Step 3: Furnish only those records which require Corrections;
  •  Step 4: Fill provisional receipt number of regular and previous correction statements
  •  Step 5: After preparation of correction statement, the same is to be validated through File Validation Utility (FVU)
  •  Step 6: Furnish validated (fvu) correction statement with a TIN-FC or directly through NSDL web-site (www.tin-nsdl.com).

 What tax software should I use?

This is very important question and answer is simple – USE THE BEST!

You don’t want anything to go wrong when the matter is about your income and refund. Use the best software with great reviews. Use Google to find the best reviews and recommendations to find the one that would make ITR filing easy and accurate.

Address

  • T-22, 3rd Floor, Super Mall, Salunke Vihar Road, Wanowrie,
  • Pune - 411040, Maharashtra, India.

  •  Head Office:+91-020-49091000
  •  Thane Office :+91-022-25800223/24/25/26

The The best income tax software is the one that serves all your tax filing needs. Different uses of the best ITR software for different categories are –

  •  Tax Consultant – Consultant would require tax software for his clients. There would be varied income sources for the clients and hence the software should be capable of serving them all.
  •  Individuals – It would be more for personal use.
  •  Self-employed – The income here would be from varied sources and there would be multiple Form 16 and TDS deductions. Software must address these needs.
  •  Small business – Business tax filing is different and so would be the software.
  •  Sole proprietor – Like business, proprietor may also use the software that address proprietorship income tax.
  •  Step 6: Furnish validated (fvu) correction statement with a TIN-FC or directly through NSDL web-site (www.tin-nsdl.com).