Have you filed your ITR? All you should know about ITR

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The last date for filing Income Tax Returns (ITRs) for income earned in the financial year 2018-19 is August 31, 2019. 

ITR is a form filled and submitted to the Income Tax Department, which contains information about a taxpayer's income and tax applicable on that income. If taxpayers have paid excess tax in a year, they will be eligible to receive a tax refund based on calculations in line with the department's regulations.

An ITR can be filed online or in a hard copy. One can visit an Income Tax office and apply in person with a hard copy. A tax return filed online is called e-filing. 

How does e-filing work?

The process of e-filing is simple and can be done easily from home. Follow these steps:

- Visit the website - incometaxindiaefiling.gov.in. Follow the links and create an e-filing account. 
- You should log in using your PAN as a login ID.
- It is essential to link your Aadhaar and your PAN. This can be done under the profile settings tab by choosing the 'link Aadhar' option.
- Fill all the relevant details in the e-filing form. 
- Check for discrepancies in Form 26AS that has the summary of taxes paid by you in a financial year. 
- Download the correct ITR form that will be sent to your registered email address.
- You upload the ITR with a Digital Signature Certificate attached to it. 
- Once you upload, the tax return filing process is complete.
 
Required documents:
- Bank account details and PAN number.
- To report salary income, you need to have Form 16, payslips and rent receipts to claim HRA. 
- You should provide address of properties, details of co-owners, including share in the mentioned property and PAN details and a certificate for home loan interest to report income from property. In case under-construction property was purchased, then the date of construction completion is required. If a property is rented, then the name of the tenant and the rental income should be mentioned. 
- In order to determine capital gains: Provide stock trading statement along with purchase details for capital gains from share sales. For property sales, you need to provide sale price, purchase price, details of registration and capital gains details. Also provide information on mutual funds, sale and purchase of equity funds, debt funds, ELSS and SIPs.
- Provide income from other sources as well. The sources include interest from savings accounts, tax saving bonds, corporate bonds or from post office deposits. 
 
Which ITR form to use?

- ITR-1: This is filed by an individual with an income from salary, pension, one house property, interest or income from other sources and has a total income of not more than 50 lakhs. 
- ITR-2: This is filed by individuals or Hindu Undivided Families (HUFs) who do not have income from a business or profession.
- ITR-3: This is filed by a person or HUFs whose source of income is from profits and gains of a business or profession.
- ITR-4: This is filed by those who have presumptive income from a business or profession.
- ITR-5: This is for firms, Limited Liability Partnerships, association of persons, body of individuals, Artificial Juridical Person, estate of a deceased person, estate of an insolvent, business trusts and investment funds.
- ITR-6: This is for companies that are not claiming tax exemption under Section 11 of the Income Tax Act.
- ITR-7: This is for those people, including enterprises, who are required to file tax returns under Section 139(4A), Section 139(4B), Section 139(4C), Section 139(4D), Section 139 (4E) or 139 (4F) of the Income Tax Act.
 
Why should I file ITR?

Even if your income level does not qualify for the mandatory filing of returns, you should file an ITR for the following reasons:

- Registering of immovable property becomes simpler as tax returns for three years are required. 
- While applying for a loan, your bank may ask for tax returns. 
- An individual or firm may claim an adjustment against losses, including short- and long-term losses. They cannot ask exemption in later years for tax calculations if they have not filed an ITR. 
- Non-filing of ITR may draw a penalty of  Rs 5,000 and can have legal implications. 
- To claim a refund on income tax, it is mandatory to file the ITR.

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