Introduction

An Income Tax Return (ITR) is a tax form that is used in order to file the income details and tax thereon with the Income Tax Department. The tax return is in a predefined format where the income figures are used to calculate the tax liability. Tax returns are required to be filed every year for any person whose income during the year exceeds the threshold limit whether through salary, property rental, dividends, interest, capital gains, from any business/ profession or other sources.

The tax returns have to be filed by a specific date depending on the type of assessee:

31st July without tax audit
30th September with tax audit

If the return shows that excess TDS has been deducted or excess advance tax paid during a given year, then the assessee is eligible for a ‘tax refund’, else he has to pay self-assessment tax.
There are 7 different forms which are available for filing of income tax returns. For Assessment Year 2017-18 the forms are ITR 1, ITR 2, ITR 3, ITR 4, ITR 5, ITR 6, ITR 7.

There are various ways in which an individual can file his ITR according to their income slabs.

Income Tax Slabs

Individuals & HUF

Domestic Companies

Association Of Persons (AOP), Bodies of individuals (BOI) and Artificial Judicial Persons

Foreign Companies

Co-operative Societies

ITR Forms

ITR forms Who can file
ITR 1
  • Income from Other sources
  • Salary
  • Pension
  • Income from up to one house
  • Agriculture Income less than Rs. 5000
  • Total Income is less than Rs. 50 lakh
ITR 2 For Individuals and HUF having

  • Income from items in ITR 1 which is more than Rs. 50 lakh.
  • Income from capital gains
  • Foreign Income
  • Agricultural Income more than Rs. 5000
  • Income from Business or Profession under a Partnership firm
ITR 3 For Individuals and  HUF having

  • Income from House Property (Multiple)
  • Income from Capital Gains (Short Term and Long Term)
  • Income from Business or Profession carried under a Proprietorship Firm (where the Individual/ HUF is the proprietor)
  • Income from Other Sources (Including Winning from Lottery, bets on Race Horses and other legal means of gambling)
  • Income from Foreign Asset
ITR 4 Income from presumptive business:

ITR 5
  • Firm
  • Limited Liability Partnerships
  • Association of Person
  • Body of Individuals
  • Artificial Juridical Persons
  • Local Authority or Co-operative Society
ITR 6 Companies not claiming exemption under Section 11
ITR 7
  • Section 139(4A)
  • Section 139(4B)
  • Section 139(4C)
  • Section 139(4D)

Process of E-Filing ITR

The process of E-Filing can be done by 2 ways online and offline.

Offline Process

If an assessee has income less than Rs.5 lakh and decides to file her return offline, she can either download the forms from the income tax website or collect it from an income tax office.

Online Process

The online filing of ITR can be done by two processes:

  • Using government website 

It is said to be a partial online process in this, you first need to download the relevant ITR form from the website and save it on your desktop. Fill up the return offline and generate a file in the XML (or Java) format, which has to then be saved on the computer and uploaded on the government portal.

  • Using service provider

Most service providers have inbuilt, self-designed, user-friendly software on their websites, and these don’t have to be downloaded. You just need to follow the instructions and fill up the form.

The process of e-filing ITR online is explained below:

  • Income Tax Return can be filed either by using “Quick e-file ITR” link on the E-filing portal or by generating “XML” using the Java/ Excel utility of the Income Tax Department according to the applicable ITR Form.
  • Alternatively, you can use software that assists in filing returns directly to the Income Tax Department portal.
  • Digital Signature Certificate (DSC) is mandatory to file IT forms for some types of assessees.
  • After filing, ITR Form V is generated, which is an acknowledgment of filing. It should then be printed, signed and submitted to CPC, Bangalore by ordinary post or speed post within 120 days from the date of e-filing. Alternatively, you can skip sending the physical copy and e-verify your return using Electronic Verification Code (EVC), Aadhar OTP or Net Banking Login.
  • Tax Return Preparers (TRP) and E-Return Intermediaries (ERI) also helps in filing E-Income Tax returns.

List of documents according to sources of income

Here is the list of documents which are required to file Income Tax Return. These documents are not to be submitted to Income Tax Department.

Basic Documents

  • Bank account details
  • PAN Number
  • Bank Passbook or Statement
  • TDS certificates – Form 16/16A (If taxes are deducted from any of your incomes)
  • Self-assessment tax & advance tax payment challans (if paid)

Income from salary

  1. Salary Certificate in Form 16 (PART-B) which is received from the employer including Basic Pay, Dearness Allowance, House Rent Allowance, and other taxable or exempt allowances and perquisites along with TDS deducted (PART-A) after taking benefit of deductions.
  2. If the taxpayer is a pensioner his pension certificate from the bank or the bank statement where his pension is received

Deductions if not declared to employer

  1. Amount which is to be contributed to the NSC, Public Provident Fund (PPF), Premium towards Life Insurance policies and other tax saving instruments under Section 80C
  2. Contribution to the recognized pension funds under section 80CCC
  3. Contribution to the National Pension Scheme under section 80CCD
  4. Medical Insurance Premium paid for self and family which are tax deductible under Section 80D
  5. Amount of donations that are made under Section 80G during the previous year

Income from business and profession

If you are earning any income from Business and Profession during the year, then following are the documents required to file return –

  • Profit & Loss statement
  • Balance Sheet
  • Supporting documents for expenses incurred
  • Bank account statement/passbook
  • Cash register
  • Any other documents required to maintain the books of accounts of business & profession
  • Audit Report in case the Total Turnover exceeds Rs. 25 Lakhs for Profession and Rs. 1 crore for Business

Income from residential property

  1. The bank statement showing the rent received
  2. Details of tenant including Name and PAN
  3. The housing loan repayment certificate for interest deduction
  4. The Municipal Corporation tax receipt
  5. The certificate of TDS deducted on rent received (if any)

Income from capital gains

  1. Stock trading statement is required along with purchase and sales details if there are capital gains from selling the shares
  2. In case a house or property is sold, you must seek sale price, purchase price, details of registration and capital gain details
  3. Details of mutual fund statement, sale, and purchase of Equity Funds, Debt Funds, ELSS, and SIPs

Income from other sources

The Individual details of all the income from other sources (e.g. interest, dividend, income from sources not included above) and the TDS certificates that are relating to it.

Agricultural income

The Bank statement which indicates the amounts that are earned from the agricultural sources.

Income to be clubbed

Details of the income which is in the hands of any the dependents or spouse whose income the taxpayer wishes to declare as his income.

Prerequisites to filing ITR smoothly

  • Check your tax credit – Form 26AS vs. Form 16

You should check Form 26AS before filing your returns. It shows the amount of tax deducted from your salary and deposited with the IT department by your employer. One must ensure that the tax deducted from income as per Form 16 matches with the figures in Form 26AS. If the returns are filed without clarity on errors, the one will get a notice from the IT department.

  • Claim 80C and other deductions

You can claim deductions from your total income.

  • Interest statement – Interest on savings accounts (80TTA)

A deduction for up to Rs.10,000 is allowed on interest earned on savings accounts. If any Interest is earned on bank deposits then, it will form a part of taxable income and is taxable at applicable slab rates.

Step after E-filing ITR

Following are the steps to be taken after e-filing ITR:

  1. Verify ITR
  2. Track the intimation status
  3. Track income tax refund status
  4. Make sure to keep income tax records

For any help on ITR Filing feel free to consult the tax experts at LegalRaasta. You can file ITR yourself via our ITR software or get CA’s help on filing income tax return. You can also use the option of Business Return, Bulk Return or Revised Return Filing.