How to File Income Tax Return in India Without Mistakes

Paying taxes is an important part of being a citizen of the country. However, despite the same, a lot of individuals tend to experience fear while filing for the Income Tax Return (ITR).

Don’t worry! The process is not as scary as it seems to be!

After learning about the whole process of filing your ITR, you will realise that it is a lot simpler than what you thought it was going to be. No matter if you are a salaried person, freelancers, businessmen or if it’s your first time filing ITR, we got you covered!

After reading this Blog, you will learn about How to File Income Tax Return in India.

What Is an Income Tax Return (ITR)?

Income Tax Return, or simply ITR, is a document that you file with the Income Tax Department on an annual basis. In it, you provide details about your income, taxes deducted, and how much additional tax payment you require or refund you may get.

It’s like your finance scorecard.

Filing ITR remains important even if your employer has deducted the Tax Deducted at Source (TDS). It also creates a record of your income that helps in getting loan approvals, visa clearances, and other government programs.

Some of the common reasons why people have to file an ITR include:

• Earn taxable income.​
• Want to claim a tax refund.
• Carry forward capital or business losses.
• Meet the filing conditions under the Income Tax Act, 1961.

Who Should File an Income Tax Return?

A common misconception is that filing an income tax return (ITR) is a task that needs to be done by people who earn more money. This assumption is wrong.

The Following individuals need to file their ITR if:

Salaried Employees

Your income exceeds the exemption limit and hence filing ITR would be compulsory for you. Even if you have your tax deducted by your employer, you need to file your ITR.

Self-Employed Professionals

Doctors, lawyers, consultants, freelancers, architects, and others are supposed to declare their income properly.

Business Owners

Whether you are running a small shop or partnership, LLP or private limited, filing ITR is a must- to-do task.

Senior Citizens

Senior citizens get some tax benefits due to which some of them are exempt from filing an ITR. However, depending on the total income and business transactions made by them, they might be liable for filing ITR.

Non-Resident Indians (NRIs)

NRIs earning money in India are also eligible for filing of ITR.

Documents You'll Need Before Filing Your ITR

A little bit of preparation will save you a lot of time.

Here are some important documents that you should have ready before starting your ITR filing.

• PAN card
• AADHAR card
• Form 16 (salaried employees only)
• Salary slips
• Banking details
• Certificates from banks (interest earned from savings)
• Form 26AS
• Annual Information Statement (AIS)
• Taxpayer Information Summary (TIS)
• Proof of investments to claim tax deductions
• Statement of Home Loan, if any
• Details of capital gains /business income
• Last year’s Income Tax Return

This will help you avoid errors while filling out the form.

Avoid rushing through this stage.

Filing errors occur often just because of missing documents or data entry errors.

How to File Income Tax Return in India: Step-by-Step Process

Here is the key part. If you are thinking about How to File an Income Tax Return in India, here are some simple steps that can help you out.

Step 1: Visit the Income Tax e-Filing Portal

First log onto the Income Tax e-Filing portal. Then login using your PAN card number, password, and also the verification code. In case you are a new user, register yourself first.

Step 2: Choose the Correct ITR Form

Selecting an appropriate form is crucial.

Depending on whether one is salaried or business/professional, people opt for different ITR forms.

If in doubt, always seek professional guidance.

Step 3: Check Your Pre-Filled Details

The portal automatically displays several details, including your personal information, salary, TDS, and bank accounts.

Don't assume everything is correct.

Take a few minutes to compare these details with your Form 16, Form 26AS, AIS, and bank records.

Step 4: Enter Any Missing Income

Next, report any income that isn't already shown.

This may include:

• Interest from savings accounts
• Fixed deposit interest
• Rental income
• Capital gains
• Freelancing income
• Business income
• Foreign income, where applicable

Being honest while reporting income helps you avoid unnecessary notices later.

Step 5: Claim Eligible Deductions

This is when most taxpayers make savings.

Under different sections of the Income Tax Act, if you qualify, you can avail yourself of deductions on investments, insurance, educational loans, home loans, and medical expenditure.

Step 6: Calculate Your Tax Liability

With all these details filled in, the portal calculates the tax for you.

In case of any extra tax liability, settle it before filing your return. In case of any excess tax paid, the portal displays the amount that is eligible to be refunded.

Step 7: Verify and Submit Your Return

Make sure to check everything carefully.

Even one spelling error, incorrect bank account details, or income amount can lead to further complications.

Finally, submit the return and perform e-verification through different methods like Aadhaar OTP, net banking, digital signature, etc.

That's it.

Your Income Tax Return is successfully filed.

Common Mistakes to Avoid While Filing an ITR

Even experienced taxpayers commit some errors. Most of them can easily be avoided.

Some common mistakes are listed below:

• Selecting the wrong form of ITR.
• Failure to include the interest income on the banks.
• Missed the deadline for filing the ITR.
• Deducted amounts without providing evidence.
• Entered an invalid PAN/Bank details.
• Neglected the Form 26AS or AIS before filing the ITR.
• Failed to e-verify the ITR.

A Thorough check-up prior to submitting will help you to save future problems.

Benefits of Filing Your Income Tax Return on Time

Filing your return before the due date offers more than just legal compliance.

It can also help you:

• Get quicker tax returns.
• Save from late filing penalties and interest.
• Maintain a good financial record.
• Apply for home, education, or business loans.
• Support visa applications with income proof.
• Carry forward eligible capital or business losses.
• Reduce the chances of receiving tax notices.

Simply put, timely filing keeps your finances organised.

Conclusion

How to File Income Tax Return in India is not as daunting as one may think at the very beginning. Once all the documents are sorted, the appropriate ITR form is selected and all the steps are followed properly, it all becomes much easier.

 

Should your income be linked to business profits, capital gains, foreign property or any combination of multiple incomes, then it may be necessary to seek the assistance of a professional for proper and accurate filing.

 

BK Taxlawfin LLP helps individuals and businesses with their income tax compliance and return filing. Should you require assistance from the experts, contact us and file your return with ease.

FAQs

1. Can I submit my Income Tax Return without Form 16?

Yes. You may be able to file your tax return using salary slip, Form 26AS, AIS, bank statement and other income documents in case form 16 is not available.

2. What will happen in case of non-filing of ITR before due date?

There will be late filing charges, interest on the tax amount due and loss of certain tax concessions if you miss the due date. It is therefore advisable to file as soon as possible.

3. Does one need to necessarily e-verify his/her Income Tax Return?

Yes. E-verification is required as your tax return will be considered incomplete if not verified according to the prescribed procedure within the time limit.

4. Is revision of Income Tax Return possible after filing?

Yes. Revision of your income tax return is possible if you make any error after filing.