8 Things to consider while filing Income Tax Return (ITR)

Income Tax Return Filing

It is always very important to know the things to consider while filing Income Tax Return (ITR)

Every year around July 31st tax payer run pillar to post to file their returns, confusion remains as they get confused in the complex web of laws which are actually put in place to make things easier for them

Here I will let you know the things to be considered while filing Income Tax Returns

1. Income Tax Returns filing Deadline & Eligibility to File Tax

Any individual who taxable income exceeds Rs. 2.5lakhs in a particular financial year is required to file Income Tax Return

For a salaried individual whose income is more than Rs. 5 lakh it is mandatory to e-file their Income Tax Return

Every year July 31st is the Income Tax Returns filing deadline for the taxpayers to file their tax returns

Many people think that since TDS is deducted and filing of tax is not important but its absolutely mandatory even if there is no tax liability on you

Many taxpayers also take it easy as an Income Tax Return, for example, FY 2018 -19 can be filed by 31st March 2020

This is actually called delayed tax return which should  be avoided as there are several disadvantages of doing that

Disadvantages of Delayed Tax Returns

• Tax Notice probability
• Unable to correct your return errors
• Delayed Refunds
• Interest on tax liability

2. To Know the Difference Between AF & FY

India the accounting year starts from 1st April & ends on 31st March

Form 16 & other financial documents are also presented for the same that is from 1st April & ends on 31st March

Earning Year – FY – Financial Year. The year in which you have earned Income is called the financial year

Evaluation Year – AY- Assessment Year. The year in which that income is assessed or evaluated that is the year immediately following the Financial Year is called the Assessment Year

For Example: if you have earned income in the year starting 1st April 2018 to 31st March 2019 then 2018 – 19 is your Financial Year (FY) and the yeat immediately following the FY that is 2019-20 is the Assessment Year (AY)

3. Selecting Correct Return Form

When you start e-filing of Income Tax Return first and the most requirement is to know which ITR form to fill

Below Chart explains which ITR Forms you should use while e-filing

ITR forms for Assessment Year 2019-20

ITR 1: Also called as Sahaj Form. This form is for individuals earning income from salary, one house and one other income such as income from interest and having total income less than Rs. 50Lakhs

ITR 2: If your income is more than Rs. 50lakhs or have capital gain income or income from other sources

ITR 3: If you have proprietorship business then you should choose ITR 3

Other forms are for other business incomes or for filing companies returns

4. Check Your TDS Details

You can now find details of TDS ( Tax Deducted at Source) already paid to the government on your behalf by your employer bank or any other party online

To avoid the possibilities of errors in tax filing you must always check your TDS details before filing your ITR

TDS details are disclosed under Form 26AS, you can access your form 26AS through your net banking by clicking any of the following text

Form 26AS/Tax Credit/TRACES/TDS Details or by clicking on ‘View Your Form 26AS’ on https://www.incometaxindiaefiling.gov.in/

5. Know About ITR-V

ITR-V is ITR Verification Form

Once you file your Income Tax Return online you automatically get your return form that is ITR-V which is a receipt or acknowledgment of your ITR

Once the e-filing is done your ITR-V needs to be sent CPC (Central Processing Centre) of the tax department in Bangalore by post within 120 days of filing the ITR

Note: Your returns filings are incomplete unless you send ITR-V by post or e-verify your tax return and also please use only India Post for this, no private couriers are Entertained on this address

6. Enter Correct and Complete Information

Always Enter Correct and Complete Information while filing ITR

• Income Tax Department communicate via email or phone so you should always ensure your phone number and email ID are absolutely correct
• Ensure that you provide your correct bank details because your bank account information is used by the department to process refunds.
• Link Aadhar number with your PAN
• List all bank accounts in ITR Form

7. What are the documents required before e-filing

Form 16 – Income & TDS details for salaried

Form 16A – This is issued by all the payers who have deducted Tax while making payment to you during the year

Property Details – If you have bought a property or put up any property on rent then the details for the rent and Municipal Tac Receipts paid during the year is needed

Capital Gain Statement – Gains from capital assets

Tax Challans – Advance Tax details

Bank Statements – For interest income earned during the financial year

If you have received any other income, for example, dividends, rent or gifts above 50 thousand then you need to give details about it in you ITR

You also need to report details of any other income which is derived or earned from outside India plus the details of all the immovable property on any capital asset held at any time during the year outside India

8. Declare all the Interest Income

All the Interest Income needs to be declared in your ITR Form below table give you all the types of Interest Income

I hope this article helps you in knowing the things to consider while filing Income Tax Return (ITR).

Click below to know the 7 benefits of filing ITR

7 Benefits of Filing Income Tax Returns

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