1. At first, you Get Form 16
Employers give your income tax deduction details in form 16. It is mandatory to give form 16 if an employer deducts tax. Form 16 is given after the end of the financial years, normally in the month of May and June.
Similarly, the bank gives you form 16A in case it has deducted TDS on your interest income. If your interest earning exceeds 10 thousand, banks deduct tax.
2. Retrieve Tax Payment Details
Your next step should be the getting details of paid tax. You can get details of TDS on form 16 or form 16A. While details of advance tax or self-assessment tax should be available on respective challans.
You should also verify your tax payment. It can be done through the form 26AS. This form contains all details of tax payment against your PAN. You can view form 26AS online. If you see any discrepancy, immediately contact your employer or bank for the rectification.
3. Choose Correct ITR Form
There are various income tax return forms for different types of income. You have to choose right ITR form considering your source of income. The simplest ITR form is for those who only earn from the salary. You can refer following tables while selecting ITR forms. These forms are for individuals and HUF. For others, there are different forms.
ITR 1 | For Individuals having Income from Salaries, one house property, other sources (Interest etc.) and having total income up to Rs.50 lakh |
ITR 2 | For Individuals and HUFs not carrying out business or profession under any proprietorship |
ITR 3 | For individuals and HUFs having income from a proprietary business or profession |
ITR 4 (SUGAM) | For presumptive income from Business & Profession |
4. Calculate Total Income For the Financial Year
Now you have to find out the total income for the financial year. To get it you can refer to form 16. It contains the gross income as well as the taxable income. You have to use the taxable income in the ITR form.
However, if you also earn from the bank deposit, you must enter the amount under ‘Extra Income’. For the income from capital gains, house rent or business, there are separate pages in the income tax return form. Your return form would become complex with the types of income. It is very easy to fill income return form if you only earn from the service.
5. Get Tax exemption and Deduction Details
The government gives you many exemptions and deduction which save tax. Hence, to reach correct tax liability, you must factor in all the eligible exemption and deductions. The exemptions are House rent allowance, transport allowance, medical allowance, LTA etc. While you get a tax deduction by investing in ELSS, NSC, PPF, insurance, tax saving FD etc.
In the income tax return form, you have to fill the total taxable income after the exemptions. Whereas, you have to enter the deductions in the given field.
Steps to e-File Income Tax Return
Register or Login to the income tax efiling website
To e-file income tax return, you have to register at incometaxindiaefiling.gov.in. If already registered, log in using your PAN and password. You can only register once using your PAN. If you forgot the password, you can reset it as well.
After login, you have to choose the assessment year for filing income tax return. Note Assessment year should be the current year for efiling tax return of the previous financial year. For example, if your filing return of the financial year 2016-17, the assessment year would be 2017-18.
You have to also choose the right income tax return form (ITR form). There are four types of form for the individuals. Among these four, only ITR-1 and ITR-4 are available for online filing. For other two forms, you have to download, fill and upload.
Give Personal Details
The income tax return form requires your personal details. The online form pre-fills some of your personal detail on the basis of PAN data. However, you would be able to edit the data.
In the same page, you have to also give your employment details. You also tell whether you are efiling before the due date or after the due date. Whether efiling is original or revised. If you are efiling revised income tax return, you have to also give details of the original return.
There is a column for those who are governed by the Portuguese civil code. There are many people in Goa which are governed by the Portuguese code.
Give Income Details
In the next page, you have to give details of your income and deductions. The page also shows the total payable tax by you. In fact, It is the most important page of the income tax efiling.
When you are entering the income from salary, fill your taxable income. It would be mentioned similarly in Form 16. This amount is reached after deduction all the applicable exemptions. It is not the gross salary. Rather it is gross salary minus exemptions.
In the income from house Property, you can fill your rental income. If your house is self-occupied and you are paying EMI, You should enter the interesting part in this field. As it is not an income but an expense, you must enter the value in a negative (with minus sign).
The bank interest income is entered in the field of income from other sources.
Give Deductions Details
This section gives you the tax benefit. The entry of this section would reduce your tax outgo. You have to enter the amount which was invested to avail tax deduction. These include the 80 C deductions and other than 80C deductions. You can claim 80C deduction up to 1.5 lakh. The NPS investment can give you the further deduction of Rs.50,000. Other sections such as medical insurance can give you extra tax saving. If you have any confusion, it is better to read about 80C deductions and other tax deductions.
Tax Computation
This section gets auto-populated based on your entry of income and deductions. The system itself calculates your tax liability and rebate if any. However, you would have the option to enter the amount of interest and foreign income relief (section 89(1)), if any. Interest is charged if you did not pay advance tax on time.
Tax Paid Details
This page contains all the details of your tax payments. If you are filing the ITR form online, all the details would be pre-filled. The system fetches tax payment details from the form 26AS. This form contains all the tax payment against your PAN.
There are 4 schedules for different types of tax payment.
1 – First schedule contains your TDS deduction by the employer. Most of the people would see entry in this section.
2- the Second schedule contains TDS deducted by banks or any other deductor.
3- The third schedule contains detail about the tax collected at source. You would see it when you collect a tax on behalf of the seller. It happens property deals.
4- In the fourth schedule, there would be details of advance tax paid by you. If you don’t pay tax on the TDS and your tax liability exceeds 10 thousand, you have to pay advance tax.
Taxes paid and verification
In the fourth page of the ITR-1, there would be a tally of payable tax and paid tax. There can be 3 situations.
1. If you have paid exact tax as per the payable tax there would not be any refund or amount payable.
2. If you have paid excess tax, there would an amount in refund. You would get back the money.
3. If you have paid less tax, there would be an amount in amount payable field. Note, if you see any amount in this section, you must cross check all the details. If there is still an amount, pay that amount before submitting the income tax return. You can pay income tax immediately through the online mode.
Give Bank Account details
You have to tell about all the bank accounts. First, you have to give details of the bank account into which you want the tax refund if any. After this, you have to mention all another bank account. Income tax department has made it mandatory to mention all of your bank accounts.
You have to enter bank account number, the name of the bank and IFS code of the bank branch as bank account detail.
Donation Details
You also get tax benefit against the donation. These donations are specified. If you want to take the tax benefit for such donation, fill the next page of the section 80G. You have to give the details of such donations. Otherwise, you can skip this page.
Submit and Verify Income Tax Return
Once you have filled the ITR form, you can submit it. After the submission, A pop up would appear to e-verify the income tax return. You can easily e-verify if you have linked you Aadhaar with the PAN. Net banking user can also verify income tax return by logging into their account.
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