income tax return

Comprehensive Guide on Income Tax Return and E-Filing

The term Income Tax Return is a type of form wherein an assessee is required to reveal information regarding annual income, deductions and tax payments to the Income Tax Department. The name ‘Income Tax Filing denotes the process of ITR filing’. Overall income tax you are bound to the Government is determined upon filing.

f in case, additional tax were paid in a financial year, the Income Tax Department would instantly refund the money to the account holder. If there are any dues, it has to be paid immediately and later proceed to ITR filing.

Some of the various Income Tax Forms are as follows:

  • ITR-1
  • ITR-2
  • ITR-3
  • ITR-4
  • ITR-5
  • ITR-6
  • ITR-7

The forms mentioned above might need disclosures like Profit and Loss Statement, Balance Sheet.

What is the purpose behind filing ITR?

It does not matter whether you are Indian or a Non-resident Indian (NRI), filing ITR is mandatory if annual income exceeds more than 2.5 lakhs. There is no harm in filing an income tax return even in circumstances where yearly salary does not cross the threshold. It is one of the essential documents to be produced while applying for a home loan. Financial capacity of the borrower can be gauged.

Those people who are planning to visit overseas to pursue higher studies or scouting for a job should file ITR of three years consecutively. Concerned personnel who are dealing with Visa application request you to present ITR documents to determine the financial stability. Moreover, it is a confirmation that he/she can support themselves while residing abroad.

What is meant by the term E-filing?

E-filing is the process of submitting income tax returns online. Income tax returns can be filed in two ways:

  • Offline way:

You need to visit the Income Tax Department directly to file returns.

  • Online mode:

It is executed via E-filing. For the past few decades, Efiling has gained popularity since it does not require printed documents.

Some of the advantages of E-filing are as follows:

  • E-filing ensures quick processing of refund returns when compared to a paper filed returns.
  • E-filing can be accessed twenty-four hours a day. Customers do have the option file both federal and state tax returns.
  • Another benefit of E-filing is that it furnishes a proof of receipt verifying acceptance of returns
  • E-filing is a user-friendly tool that provides comprehensive details on how to take advantage of it.
  • Chances of flaws are minimum since the software can track mistakes.
  • E-filing guarantees optimum security as opposed to mailing tax returns.
  • You can rest assure hassle-free experience with E-filing due to the absence of postage fees and W-2 statements.

E-filing Income Tax Returns – An overview

  • PAN, Aadhar Card and permanent address are some of the necessary information to be presented before E-filing tax returns.
  • Complete detail of the bank account of a specific financial year is required before filing an online income tax return.
  • Proof of income from various sources such as Monthly Salary, Fixed Deposits, and Savings Bank account should be produced before ITR filing online
  • Information about deductions claimed as per Section 80 during ITR filing online
  • TDS and related up-to-date tax payment information

There are a few points to consider before registration and viewing E-file income:

  • One should possess a valid Digital Signature Certificate (DSC). To activate this, browse the IT site, choose profile setting and pick Register Digital Signature Certificate. Those who do not carry a DSC need to mail a form directly to IT department processing centre followed by Efile tax returns.
  • Filing ITR is a prerequisite to display Efile income. However, you should carry essential documents, including TDS certificates, interest, and home loan statements along with investment details.
  • 26AS form, which is downloaded, contains a summary of tax paid as opposed to PAN.
  • Verify tax returns alongside 26AS form to confirm tax liability.
  • Those individuals who are earning more than fifty lakh per year are supposed to cover extra columns, namely “Assets” and “Liabilities”.
  • Reveal both assets and liabilities value to view Efile income. Nevertheless, the former should be disclosed at cost.
  • Those who have opted to fill the form via offline, they are required to pick ‘Generate XML’. Visit the official website and choose ‘upload XML’ button.
  • Confirmation and verification of ITR V:-

Who can file Income Tax Returns?

Those individuals who fall under any one of the categories mentioned below are subject to file income tax returns:

  • If a person is aged below sixty years and the overall annual gross income is more than Rs. 2,50,000.
  • Senior citizens aged above sixty but not more than eighty. Gross yearly income should not cross Rs. 3, 00, 000.
  • Super senior citizens with an age limit of eighty years and above. Total annual gross should not exceed Rs. 5, 00, 000.
  • Income tax return for a financial year is to be filed regardless of profit or loss encountered by a company

What are the benefits of filing Income Tax Returns?

  • Filing Income Tax Return enables you to apply for a home or vehicle loan. However, concerned banks request a person to produce TDS certificates and a copy of ITR.
  • Income Tax Return acknowledgement and processing of refunds are done instantly when compared to paper file returns.
  • The chances of errors are minimal when compared to Paper-filed returns.
  • Presence of E-filing allows you to file returns at any time from any corner of the globe thereby eliminating time as well as location constraints

Need Assistance in ITR E-filing

All India Income Tax Return has empowered tax experts to go through the tax situation of an individual. They are offering tailor-made tax assistance and tax services. Individuals can avail their services by getting connected with them through an online toll-free number.

What is meant by the term ‘Return of Income’?

Income Tax Return is a type of form that highlights the income particulars of an individual during a financial year. It includes taxed paid by him/her on income

What is Form-16?

Form-16 is one of the important documents to be filed by a salaried individual. It is a TDS certificate duly signed and issued to an employee by his/her employer. This certificate contains salary details and TDS deduction as well. Form-16 should be supplied to an employee if the concerned employer automatically deducts TDS. Income Tax Return-1, which is issued by the Income Tax Department, blends with Form-16. In this case, you need to draft details given in Form-16 to Income Tax Return.

Form-16 is broadly classified into two, namely Part-A and Part-B. The former one contains information regarding tax deducted by the concerned employer of a firm per year. In addition to deducted tax, details of Permanent Account Number (PAN) and Tax Deduction Account Number (TAN) of an employer are included. In Part-B, list of gross salary breakups like perquisites and allowances are described in detail.

Interest incomes from post office and banking institutions

The latest Income Tax Returns forms have recommended the taxpayers to mention interest incomes that might be in the form of fixed deposits, savings bank account, etc. Usually, interest income credited in the account is taxable, but they can claim for deduction of Rs. 10,000 as per Section 80TTA. On the other hand, senior citizens do have the option to claim deduction up to Rs. 50,000.

Income Tax Department pays close attention to any sorts of disparity or unlawful claimed deduction. As a result, one needs to be vigilant during the Income Tax Return filing forms. He/she should grab the Interest certificates directly from banks or post office to get a brief overview of overall interest earned.

Those who do not possess interest certificates keep updating your passbook (bank account statement) every month. TDS certificate shows total interest earned and tax deducted per month.

What is Form-16A, 16B and 16C?

Form-16A is issued to people who have opened a fixed deposit or recurring deposit account. This form is supplied in circumstances where TDS is deducted on interest received from fixed deposits as well as recurring deposits. For instances, when a seller has sold his property, the buyer automatically furnishes Form 16-B that contain details of TDS deducted from the payment made to the seller. If a landlord is earning monthly rental income, then it is highly recommended to request the occupant to issue Form 16C that contain details of TDS deducted from the rent collected by landlord.

According to the existing law, it is mandatory to deduct TDS if monthly rent exceeds more than fifty thousand. Additionally, you can confirm and verify 26AS for complete TDS detail.

What is Form 26AS?

Form 26AS is an integrated annual tax statement that is quite similar to a tax passbook. It includes vital information about taxes which were deposited as opposed to PAN. The information contained is as follows:

  • TDS deducted by banking institutions, employer of an organization
  • Self-assessment, advance tax paid and deposited respectively

Forms 26AS can be download via the official website of TRACES. To commence download, you are required to log in to the account. Later, choose ‘View 26AS’ that falls under the tab ‘My Account’. It would automatically redirect you to the website of TRACES to download the form.

One should make sure that taxes deducted during a specific financial year are displayed as opposed to PAN in the Forms 26AS. You may request the tax deductor to resolve flaws if found any failing which an individual cannot claim for the tax credit.

Submitting tax saving Investment Proofs

Each tax-saving investments and expenditures incurred by an individual during a financial year are subject to deduction as per Section 80C, 80CCC and 80CCD. It is useful in minimizing tax liability. An overall tax break that can be claimed should not be more than 1.5 lakh per year. Employees Provident Fund, Public Provident Fund, and National Pension System contain tax breaks according to section 80C.

Supporting documents to claim a tax deduction as per Section 80D, 80U

Besides expenditures and tax-saving investments, individuals have the right to claim for deductions in expenses that fall under various sections of the Income Tax Act.

If an individual has paid the health insurance premium on behalf of their parents, based on the age, he/she could claim for an additional deduction that ranges from Rs. 25,000 to Rs. 50,000. Extra deduction of Rs. 25,000 can be claimed if a person is aged below sixty years. But if a person is aged above sixty years, he/she can claim for deduction up to Rs. 50,000.

Those people who have not possessed health insurance coverage have the right to claim for deduction from medical cost incurred as per Section 80D. However, they are required to produce medical bills as proof to claim a deduction.

According to Section 80E, an individual does have the option to claim for a deduction if he/she has executed interest on education loan. A specific threshold on total interest paid is not set in the case of an education loan. To claim a deduction, you need to request for an interest paid certificate directly from the bank.

Home loan statement

Those individuals who have applied for a home loan from any prominent banking institution, they need to gather a loan statement of the previous financial year. It furnishes details of principal and interest reimbursed by a person. They are often presented as proof, especially while filing an income tax return.

As per Section 24, the Tax liability can be minimized if interest is paid on the home loan. The estimated amount which can be claimed is about two lakhs. One should produce an amount of interest paid and monthly rental income generated from a particular property.

Net capital gain

Up-to-date information about capital gain earned via the sale of a property is to be mentioned in Income Tax Return forms. To determine capital gain upon sale of a property, both purchase and sale deed is needed.

Statements from mutual fund houses and brokers should be produced for determining accrued capital gains. A complete profile of the buyer like full name, PAN and home address is to be included upon revealing capital gains aroused out of property sale in ITR-2.

Long-term-capital-gains (LTCG) aroused out of the sale of equity shares, or equity-based mutual funds are subject to tax if the amount is more than one lakh.

Savings bank account pre-affirmation to claim Electronic Clearance Service refund

The Income Tax Department had recently declared a statement regarding the e-refunds issue. It will be credited to bank accounts that are directly linked to PAN. As a result, it is imperative to link PAN card with Savings bank account to claim for Income Tax refund (ITR).


Furnishing details of AADHAR has been made compulsory to file Income Tax Returns. As per the section 139AA under the Income Tax Act, a salaried person is bound to present AADHAR details while filing Income Tax Returns.

If in case of absence of AADHAR card, then it is suggested to include the enrolment ID while filing Income Tax Return.

Gather information of investment contained in unlisted shares

Those individuals who have their shares invested in an unlisted organization should furnish related information while filing Income Tax Return. It does not matter where the source of income, i.e. salaried returns or business returns, you are bound to file Income Tax Return if you are still holding shares in an unlisted company.

Full details of investments, full name and PAN card is to be produced as per section Income Tax Return-2. Investment details are broadly classified into four categories, namely shares procured, opening balance, transfer of shares in a particular financial year along with the closing balance.

Fetch details of the bank account

It is mandatory to submit details of all bank accounts upon filing Income Tax Returns. Some of the essential information to be included in the form are as follows:

  • Bank Name
  • Account number
  • Type of account
  • IFSC Code

You need to make sure that you have inputted the right IFSC code to receive refunds smoothly.

Update saving banks passbooks of bank and post office every month

Apart from updating saving banks and Post office passbook, PPF passbooks should be taken into consideration in a financial year. Even though interest received through PPF does not fall under the tax slab, it has to be mentioned clearly in the Income Tax Return.

Salary Slips

Income Tax Department had officially announced their decision to introduce salary slips as per Income Tax Return-2. Details of monthly income salary along with dearness allowance and house rent allowance have to be specified.

Evading taxes is considered to be a serious offence regardless of aware of the fact that it is mandatory to file Income Tax Return. Source

1 thought on “Comprehensive Guide on Income Tax Return and E-Filing

  1. Employee Provident Fund is an important amenity provided by companies and remains, without a doubt, the favourite product of employees. At the same time, no employee enjoys it when a tax deduction is made on the EPF leading to them getting less than what they want. Both the individual in question and the employer have to pay a portion of it, and together it contributes to this fund.

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