What Tips Should Taxpayers take Care of While Filing the ITR for the First Time?
Relevant Slab and Regime
It is important to know under which tax slab you belong. The income tax liability depends on which slab is applicable to you. Also, from April 1st, 2023, the new tax regime is the default tax regime; however, If you want to opt for the old tax regime, you can do that.
The slab structure is as follows:-
| Slabs |
Old Tax Regime |
New Tax Regime |
| <60 years & NRIs |
>60 to <80 years |
> 80 years |
FY 2022-23 |
FY 2023-24 |
| ₹0 - ₹2,50,000 |
NIL |
NIL |
NIL |
NIL |
NIL |
| ₹2,50,000 - ₹3,00,000 |
5% |
NIL |
NIL |
5% |
NIL |
| ₹3,00,000 - ₹5,00,000 |
5% |
5% (tax rebate u/s 87A is available) |
NIL |
5% |
5% |
| ₹5,00,000 - ₹6,00,000 |
20% |
20% |
20% |
10% |
5% |
| ₹6,00,000 - ₹7,50,000 |
20% |
20% |
20% |
10% |
10% |
| ₹7,50,000 - ₹9,00,000 |
20% |
20% |
20% |
15% |
10% |
| ₹9,00,000 - ₹10,00,000 |
20% |
20% |
20% |
15% |
15% |
| ₹10,00,000 - ₹12,00,000 |
30% |
30% |
30% |
20% |
15% |
| ₹12,00,000 - ₹12,50,000 |
30% |
30% |
30% |
20% |
20% |
| ₹12,50,000 - ₹15,00,000 |
30% |
30% |
30% |
25% |
20% |
| >₹15,00,000 |
30% |
30% |
30% |
30% |
30% |
Gather all your income sources
Income consists of earnings, expenses, deductions, and investments. Hence it is important to disclose all the information from all sources – rent, investment, etc., irrespective of whether they are taxable or exempt from taxation. It is important to mention all your income sources when filing ITR. Also, in some cases, it is important to report your income or assets in the ITR, even if your total income falls below the taxable limit. Therefore, gathering all the documents and keeping a proper record of transactions and income can make it easier to file an ITR.
Consider all deductions
There are various kinds of deductions that can be considered while filing the return. All the required conditions need to be satisfied before considering the deduction. Deductions can be claimed under sections 80C, 80D, 80E, etc. However, most of the deductions are only available under the old regime and not under the new regime of income tax.
Filling up the form correctly
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Form 16 & Form 16A
Form 16 & Form 16A is a certificate for Tax Deducted at source (TDS). Form 16 is only for salary income. It consists of 2 parts - Part A and Part B., on the other hand, Form 16A, is applicable for TDS on income sources apart from salary. Read more here.
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Form 26AS
Form 26AS is a statement that provides details of any amount deducted as TDS or TCS from various sources of income of a taxpayer. It also reflects details of advance tax/self-assessment tax paid, and high-value transactions entered into by the taxpayer.
Form 26AS is a consolidated annual statement that the Income Tax Department maintains. It contains the tax credit information of each Taxpayer against his PAN. It also reflects details of advance tax/self-assessment tax paid and high-value transactions entered into by the taxpayer. Read more Here.
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Correct ITR forms
The Income Tax Return (ITR) forms that need to be filed vary depending on the nature of your income, the sources of your income, and your residential status. There are 7 ITR forms provided by ITD.
ITR-1: (Sahaj): For individuals having income from salary, one house property, and other sources (excluding lottery and racehorses).(income less than Rs 50 lakhs)
ITR-2: For individuals and Hindu Undivided Families (HUFs) not having income from business or profession (income more than Rs 50 lakhs)
ITR-3: For individuals and HUFs having income from business or profession.
ITR-4 (Sugam): For individuals, HUFs, and firms (other than LLP) with presumptive income from business or profession.
ITR-5: For firms, LLPs, AOPs, BOIs, artificial juridical persons, cooperative societies, and local authorities.
ITR-6: For companies other than companies claiming exemption under section 11.
ITR-7: For persons including companies required to furnish a return under sections 139(4A), 139(4B), 139(4C), or 139(4D) (specific categories such as trusts, political parties, institutions, colleges, etc).
ITR-V: This is not a filing form but an acknowledgement form that needs to be printed, signed, and sent to the Income Tax Department after filing the ITR online if not e-verified.
Read more here.
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Form AIS/TIS
The Annual Information Statement (AIS) is a detailed summary of a taxpayer's information given in Form 26AS. In addition to the TDS/TCS details, AIS will also show interest, dividends, stock market transactions, mutual fund transactions, etc.
In case there are errors, it also accepts feedback from the taxpayers on the information displayed in AIS.
-
Keep track of the ITR filing dates
It is very crucial to take a tab on the ITR filing date. individuals and HUFs (excluding those who require audit): The due date for filing ITR for individuals and Hindu Undivided Families (HUFs) who are not subject to audit is July 31st of the assessment year. For example, for the financial year 2022-2023 (assessment year 2023-2024), the due date would be July 31, 2023.
- Individuals and HUFs requiring audit or those with business/professional income: If the individual or HUF is subject to audit under the Income Tax Act or if they have income from business or profession, the due date for filing ITR is September 30th of the assessment year. For example, for the financial year 2022-2023 (assessment year 2023-2024), the due date would be September 30, 2023.
- For people who fail to file their ITR by the due date or make a mistake while filing ITR, there is a facility to file a belated return or a revised return by the end of the year, i.e. 31st December 2023 for F.Y 23-24. Filing a belated return comes with a penalty, however, you don’t have to pay any penalty while filing a revised return.
It's important to note that these are the general due dates, and there may be specific exceptions, extensions, or changes announced by the Income Tax Department from time to time. It is advisable to stay updated with the latest notifications and guidelines from the Income Tax Department or consult a tax professional to ensure compliance with the specific deadlines for filing ITRs. Read more here.
E-verification of ITR
E-verification of Income Tax Returns (ITRs) is necessary within 30 days after filing of ITR to ensure the authenticity and integrity of the filed returns. It serves as a method of verifying that the taxpayer has indeed reviewed and approved the information provided in the ITR.
An acknowledgment message is shared once the verification is completed on your email and mobile. This proof should be kept safe.
How to File ITR for the First Time Online?
If you are filing ITR for the first time on the e-filing portal. You have to register first. Here are the steps to register yourself in the Income Tax Portal:-
Step 1: Visit the official e-filing portal.
Step 2: Click on 'Register' to register yourself. Now, click on 'Taxpayer'
Step 3: Enter your PAN details, and click on 'Validate'. Click on ‘continue’.
Step 4: Share the accurate details of name, gender, address, and other contact details.
Step 5: After filling out the form, check your details and click on 'Continue'
Step 6: A one-time password (OTP) will be sent to your registered e-mail ID and mobile number
Step 7: Once the OTP is verified, you can further modify the details if there are any mistakes. Following that, another OTP will be sent in order to verify the changes.
Step 8: Now, set a password and secure login message and click on 'Register'.You will receive an acknowledgment message on the success of the registration process.
Once you have registered yourself on the Income Tax Portal, the next step is to calculate your taxable income and file your ITR in the correct ITR form applicable to you.
- Step 1: Once you have registered on the site, now log in with the ID and Password generated at that time.
- Step 2: Click on the 'e-file' tab and then click on the 'File Income Tax Return' tab.
- Step 3: Select the Assessment Year and click on 'Continue'
- Step 4: Click on 'Online' as the mode of filing.
(Note - If you're an individual, then click on the option 'Individual')
- Step 5: Choose the suitable ITR form
- Step 6: You have to provide a reason for filing your ITR
- Step 7: Enter your Bank Account details. In case you have provided your Bank Account details, then pre-validate it
- Step 8: Validate your ITR summary
- Step 9: Verifying your returns is the last step after filing your ITR.
If you are unable to e-verify your ITR then send a signed copy of ITR V to the Income Tax Department within 30 days of filing your ITR.
OR,
File your ITR with Tax2win
If you are wondering how to file an ITR with Tax2win, here are some simple steps you need to follow -
Step 1: Either sign in to the tax2win website using your existing credentials or sign up to the portal and create an account. You can do self-filing only in the case of income from salary, business, and capital gains.
Step 2: After logging in, a table consisting of all the possible sources of income opens. You need to select the income sources that you have. Based on your sources of income, Tax2win’s DIY ITR filing system selects the applicable ITR form automatically.
Step 3. You need to upload Form 16. In case you don’t have Form 16, you can simply skip the option and proceed further.
Step 4. Select the F.Y. and enter the PAN Details and DOB. (If you don’t have a registered account with the Income Tax Department, you will receive an OTP and a new account will be created.). You can also choose if you want our DIY software to fetch your personal details and get data pre-filled.
Step 5: Enter a few basic details in the next step. Some of it is pre-filled from the Income Tax Department’s database. Remember to cross-check the information available. As shown in the image given below, you have to enter your personal details like name, email id, date of birth, father’s name, gender, etc.
Step 6: In the next step, you have to provide your address details and employer category. You can refer to the image below to understand this better.
Step 7: In the next step, you have to fill in your employment details. The standard deduction is applied automatically in the case of salaried employees. As shown in the image below, you have to enter your gross salary/CTC, exempted allowances like HRA, LTA, gratuity, net salary, and standard deduction and professional tax under section 16. Note that if you have uploaded Form 16, your employment data will be pre-filled in the ITR Form. All you have to do is verify the information and proceed to file ITR.
Step 8: Enter the details of the investment made during the year to calculate the applicable deductions. You have to enter details of investments in PPF, LIC, PF, housing loan, FDR, NSC, tuition fees, premiums paid to the annuity, and other 80C deductions. Also, you can claim deductions like 80D, 80CCD (1B), 80G etc.
Step 9: In this step, you are required to enter your bank details. Enter your IFSC code, name of the bank, account number, and Aadhaar details. As per government law, it is mandatory to show all the bank details. You can select one account as the primary account. Remember, you will get a tax refund in your primary bank account.
Step 10: In this step, you have to upload Form 26AS, and your TDS details will be auto-populated. If you don’t have Form 26AS, you can skip it and fill in the details manually before filing your ITR. If you have paid the tax, select yes on Advance Tax and self-assessment tax paid, enter the challan details, and click on Continue.
Step 11: Select the return filing type. If your income is less than Rs.2.5 lakhs and electricity expenses during the year are more than 1 lakh, OR incurred the Foreign Travelling expenses of more than Rs. 2 lakh., select yes on the option ‘Are you filing return under the seventh proviso to section 139(1). Also, select the number of days for which you have stayed in India in the relevant FY. The system will automatically determine your residential status.
Step 12: Based on the information given by you in the previous sections, the software automatically computes your tax liability using both the old and the new regime. You can compare both regimes and select the one that is more beneficial for you.
Step 13: Remember to cross-check all the information in return, click on the checkbox, and click on “File my return.” And here, you are done with filing. Don’t forget to e-verify the ITR at the same time. Remember to e-verify your return within 30 days.
Now that you know how to file ITR and things to keep in mind, you can go ahead and file ITR on your own. However, we understand that doing it all for the first time can be confusing and intimidating, therefore, hiring an online CA can be a good option for you as it will help streamline the entire ITR filing process. Book an eCA Now!
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