How to File Income Tax Returns (ITR) Online in India?

How to File Income Tax Returns (ITR) Online. Filing Income Tax Returns (ITR) is an essential responsibility for every taxpayer in India. With the advent of technology and the government’s push towards digitalization, filing ITR online has become a convenient and efficient process.

In this complete guide, we will walk you through the step-by-step process of filing your income tax returns online in India.

Also Read-Income Tax Exemptions and Deductions in India: 

Understanding Income Tax Returns (ITR).

Before we dive into the process of filing ITR online, let’s first understand what an income tax return is. An income tax return is a form that taxpayers use to report their income, deductions, and tax liability to the Income Tax Department. It is a declaration of the taxpayer’s income from various sources such as salary, business, investments, and other sources.

Filing ITR is mandatory for individuals whose total income exceeds the basic exemption limit, which varies based on age and residential status.

For the Financial Year 2023-24 (Assessment Year 2024-25), the Basic Exemption Limits Are as Follows:

• For individuals below 60 years of age: Rs. 2.5 lakh
• For senior citizens (60 years and above but below 80 years): Rs. 3 lakh
• For super senior citizens (80 years and above): Rs. 5 lakh

Prerequisites for Filing ITR Online.

Before you start the process of filing your ITR online, ensure that you have the following documents and information ready:

1. PAN (Permanent Account Number)
2. Aadhaar number
3. Form 16 (if you are a salaried employee)
4. Form 26AS (tax credit statement)
5. Bank account details
6. Details of income from various sources (salary, business, investments, etc.)
7. Details of deductions and exemptions claimed
8. Details of taxes paid (advance tax, self-assessment tax, TDS)

How to File Income Tax Returns (ITR) Online Step-by-Step Guide.

Now that you have all the necessary documents and information, let’s walk through the process of filing your ITR online:

Step 1: Register on the Income Tax e-Filing Portal.

Visit the Official Income Tax e-Filing Portal and register yourself if you haven’t already. If you are a new user, click on the “Register Yourself” button and provide the required details such as PAN, Aadhaar number, and personal information. Once registered, log in using your user ID, password, and captcha code.

Step 2: Select the Assessment Year and ITR Form.

After logging in, go to the “e-File” menu and click on “Income Tax Return.” Select the assessment year for which you want to file the return (e.g., 2024-25 for the financial year 2023-24). Choose the appropriate ITR form based on your sources of income and tax status.

Types of ITR Forms.

The Income Tax Department provides different ITR forms for various categories of taxpayers. Here are the common forms:

• ITR-1 (Sahaj): For individuals with income from salary, one house property, and other sources (excluding lottery winnings and income from racehorses) up to ₹50 lakh.
• ITR-2: For individuals and Hindu Undivided Families (HUFs) not having income from business or profession.
• ITR-3: For individuals and HUFs having income from business or profession.
• ITR-4 (Sugam): For individuals, HUFs, and firms (other than LLP) with a total income of up to ₹50 lakh and having income from business and profession computed under sections 44AD, 44ADA, or 44AE.
• ITR-5: For persons other than individuals, HUFs, companies, and persons filing Form ITR-7.
• ITR-6: For companies other than those claiming exemption under section 11.
• ITR-7: For persons including companies required to furnish returns under sections 139(4A), 139(4B), 139(4C), or 139(4D).

Step 3: Fill in the ITR Form.

Once you have selected the appropriate ITR form, start filling in the required details. The form is divided into several sections, such as personal information, income details, deductions, taxes paid, and tax liability. Carefully enter the information from your Form 16, Form 26AS, and other relevant documents.

Double-check all the details entered to ensure accuracy. Any discrepancies or errors in the information provided may lead to notices from the Income Tax Department.

Step 4: Verify and Submit the ITR.

After filling in all the details, verify the information entered and click on the “Submit” button. You will be directed to a page where you can choose the mode of verification.

There are several options available for verifying your ITR:

1. Aadhaar OTP: If your Aadhaar is linked to your PAN, you can verify your ITR instantly using a one-time password (OTP) sent to your registered mobile number.
2. E-Verification using Digital Signature Certificate (DSC): If you have a valid DSC, you can use it to digitally sign and verify your ITR.
3. E-Verification using Electronic Verification Code (EVC): You can generate an EVC through various modes such as net banking, ATM, bank account, or Demat account.
4. Sending signed ITR-V to CPC: If you are unable to e-verify your ITR, you can download the ITR-V (acknowledgment) form, sign it, and send it to the Central Processing Centre (CPC) in Bengaluru within 120 days of filing your return.

Step 5: Acknowledgment and Processing.

Once you have successfully verified your ITR, you will receive an acknowledgment number and an email confirmation. The Income Tax Department will process your return, and if everything is in order, your return will be accepted.

If there are any discrepancies or additional information required, you may receive a notice from the department.

Why File ITR?

Filing ITR is not just a legal obligation but also offers several benefits:

1. Legal Compliance: Filing ITR ensures you comply with Indian tax laws, avoiding penalties and legal consequences.
2. Financial Documentation: ITR serves as proof of income, which is essential for various financial transactions like applying for loans or visas.
3. Claiming Refunds: If you have paid excess tax, filing ITR allows you to claim a refund.
4. Carry Forward Losses: Filing ITR on time enables you to carry forward losses to subsequent years, reducing future tax liabilities.

Common Mistakes to Avoid while Filing ITR Online.

To ensure a smooth and error-free ITR filing process, avoid these common mistakes:

1. Not reporting all sources of income: Make sure to declare income from all sources, including salary, business, investments, and other sources.
2. Incorrect personal information: Double-check your personal details such as name, address, PAN, and Aadhaar number to avoid any mismatch.
3. Claiming incorrect deductions and exemptions: Ensure that you are eligible for the deductions and exemptions claimed and have the necessary supporting documents.
4. Not verifying the ITR: Failing to verify your ITR within the specified time limit may lead to your return being treated as invalid.
5. Missing the filing deadline: File your ITR before the due date to avoid penalties and interest charges.

Benefits of Filing ITR Online.

Filing your income tax returns online offers several advantages:

1. Convenience: You can file your ITR from the comfort of your home or office, without having to visit the Income Tax Department office.
2. Time-saving: The online process is faster and more efficient compared to the traditional paper-based filing method.
3. Instant acknowledgment: You receive an instant acknowledgment and confirmation upon successful filing and verification of your ITR.
4. Faster processing: Online filing ensures quicker processing of your return and refund, if applicable.
5. Easy access to past returns: You can easily access and download your previous years’ ITR and acknowledgments from the e-Filing portal.

Summary.

Filing your income tax returns online is a simple and convenient process that every responsible taxpayer should follow. By understanding the requirements, gathering the necessary documents, and following the step-by-step guide, you can easily file your ITR online and fulfill your tax obligations.

Remember to file your return before the due date, which is usually July 31st for individuals and October 31st for taxpayers whose accounts need to be audited. In case you miss the deadline, you can still file a belated return, subject to certain penalties and interest charges.

It is always advisable to keep accurate records of your income, expenses, and investments throughout the year to make the ITR filing process smoother. Regularly check your Form 26AS and Annual Information Statement (AIS) to ensure that all your tax credits are reflected correctly.

If you face any difficulties or have queries while filing your ITR online, you can seek assistance from the Income Tax Department’s helpdesk or consult a qualified tax professional.By staying informed about the latest tax laws, deadlines, and procedures, you can ensure timely and accurate filing of your income tax returns and contribute to the nation’s growth and development.

C.K. Gupta

Hello, I am C.K. Gupta Founder of Taxgst.in, a seasoned finance professional with a Master of Commerce degree and over 20 years of experience in accounting and finance. My extensive career has been dedicated to mastering the intricacies of financial management, tax consultancy, and strategic planning. Throughout my professional journey, I have honed my skills in financial analysis, tax planning, and compliance, ensuring that all practices adhere to the latest financial regulations. My expertise also extends to auditing, where I focus on maintaining accuracy and integrity in financial reporting. I am passionate about using my knowledge to provide insightful and reliable financial advice, helping businesses optimize their financial strategies and achieve their economic goals. At Taxgst.in, I aim to share valuable insights that assist our readers in navigating the complex world of taxes and finance with ease.