How to File ITR Online
The income tax return also referred to as ITR is a form that all taxpayers must fill and submit to the government for each financial year. This form contains information on earnings from varied income sources, Tax Deducted at Source (TDS), and savings and investments that qualify as tax deductions. After the computation of these, a tax is levied to the overall income earned in a year, which is then paid to the government.
ITR is often considered to be a complex process. With so many things involved, many people resort to the help of professional chartered accountants to file ITR. However, with the rise of digitalization in the country, the Government of India has now made it possible for you to file your ITR online from the comfort of your home or office.
By following a series of simple steps, you can file your ITR without having to pay hefty fees to a professional. The process is straightforward and hassle-free.
Read on to know how to file income tax return online.
1. Register yourself on the government income tax portal: To file your ITR, the first step requires you to register yourself on the government income tax portal. You can start by logging on to the income tax website. On the right-hand side, you will find a tab, ‘Register Yourself’. Click on this tab and proceed to fill in the details. You will be asked to select the type of taxpayer you are filing as for the concerned financial year. This could like an individual, a Hindu Undivided Family (HUF), external agency, chartered accountants, etc.
Then, you will be asked to enter details like your name, date of birth, pan card number, residential details, mobile number, email address, etc. After your pan card number is verified, a mail will be sent to your email address. This mail will contain a link to verify and activate your account.
After you click on the link, your registration will be complete, and your income tax account will be active.
2. Calculate your income tax: Before proceeding to file your return, you have to first calculate your total income tax. To do so, you can take your gross earned income of the year. This includes income from a job, part-time or freelancing opportunities, interest earned from investments, rent received from a leased property, etc.
If you have any investments or savings, you can claim tax deductions on them too. These can include life insurance plans, systematic investment plans (SIPs), etc. You can also claim a tax deduction on some expenses incurred, such as taking care of a physically challenged dependent, etc. All of these investments, savings, and expenses should be permissible under the Sections of the Income Tax Act of 1961, like Section 80C, Section 80DD, etc.
3. Download Form 26AS: Form 26AS is a document that contains information on your TDS. This is the amount of tax that has already been paid on your behalf by the deductor. A deductor can be your employer who cuts some percentage of tax at source before handing over your salary. You can download this form from the income tax website to know how much tax you have already paid to the government and how much is yet to be paid.
If you are liable to receive any refund, you will be able to calculate the same from your Form 26AS.
4. Select the right tax form: There are a total of 7 ITR forms available on the income tax website. Each of these is meant for different categories of individuals:
- ITR 1: This form can be used by resident Indians who have earned less than ₹50 lakhs in a year from their income, one house property, or other sources.
- ITR 2: This form can be used by individuals earning from capital gains, foreign assets, more than one house property, holding a directorship in a company, or unlisted equity shares. It also includes all incomes from ITR 1.
- ITR 3: This form contains all incomes from ITR 2, along with income from a business, profession, partnership firm, and any presumptive income greater than ₹50 lakhs.
- ITR 4: This form includes all incomes from ITR 1, and presumptive income from salary, pension, one house property, and other sources. The total income must be more than Rs.50 lakhs.
- ITR 5: Firms, Association of Persons (AOPs), Limited liability Partnerships (LLPs) and a Body of Individuals (BOIs) can use this form.
- ITR 6: This form can be used by companies who are not claiming an exemption under Section 11 of the Income Tax Act of 1961.
- ITR 7: Companies that fall under Section 139 (4A), Section 139 (4B), Section 139 (4C), Section 139 (4D), Section 139 (4E), or Section 139 (4F), use this form.
You can select a form that you qualify for, based on your profession and source of earnings. However, keep in mind that only ITR 1 and ITR 4 can be filed online. All other forms have to be filed offline.
5. Download the utility sheet: Once you know how to file ITR online, the next step requires you to download the utility sheet. You can download this by clicking on the ‘IT Return Preparation Software’ tab on the income tax website. You can either download this file in an MS Excel format or a Java Utility format. Select the correct assessment year before you click on download.
6. Fill it, convert it to XML, and upload the utility sheet: Fill in all the necessary details asked in the sheet. After you finish, you need to click on ‘Validate’ to certify the information you have entered. Remember to check for errors and rectify them before you do this. You can then convert the file to an XML format and upload it on the website.
Click on the ‘e-File’ tab and then on the ‘Income Tax Return’ option from the drop-down menu. Fill in your pan card number, assessment year, form number, and select a submission mode (XML).
Click on ‘Submit’.
7. e-Verify your return: Even though your form has been submitted, your ITR filing process is not complete yet. You also have to verify your return. To do this, the system will generate a One Time Password (OTP) and send it to the mobile number that is linked to your Aadhaar card.
You can either use this method or send a signed, downloaded copy of your income tax return to CPC, Bengaluru, Karnataka.
How to file income tax return online: Another way
Many online portals offer to file your ITR on your behalf. You can look for these portals online and select the one you like. All you need is a copy of your Form 16 and any investment proofs that you may have for the year. You can submit these documents, fill a simple form, and the portal files your return for you.
Regardless of the method you choose, you must file your ITR within the allotted dates. Missing the deadline to file your ITR can lead to penalties that can put a financial burden on you. The due date is decided by the government. For the year 2020, the date has been extended to Dec 31, 2020.
Filling ITR is misunderstood to be a long and taxing procedure. However, with the ease of online filing, the process can be completed within a couple of minutes. The only things required are an internet connection, a computer, and all your earnings and tax information. It helps not to delay your income tax filing and always be careful while filling all details. Small errors can lead to discrepancies that can be termed as fraud and result in income tax notices.
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