A Comprehensive Guide to Filing Income Tax Return (ITR) in India

Everyone earning an income has to undergo the daunting task of filing an annual income tax return. This post aims at distilling the information from an informative video tutorial by C RAR, a popular influencer, on how to file your income tax return in a hassle-free manner.

Key Takeaways

1. Income tax return should be filed by those who have income from salary, house property, or other sources.
2. ITR1 aka 'Sahaj' is appropriate for individuals with income up to 50 lakh rupees.
3. All the data required for filing ITR can be accessed in the Annual Information Statement (AIS).
4. If the process seems too intricate, one can seek professional help, ideally from a chartered accountant.

When Should You File an Income Tax Return?

It is mandatory to file an income tax return (ITR) if your taxable income is more than the basic exemption limit. However, there can be other scenarios where filing an ITR is necessary, regardless of your income being below the exemption limit.

Understanding the Income Sources

• Salary: Your employer provides this information in Form 16.
• House property: This includes the rental income you receive from a rented property.
• Other sources: This could include interest from fixed deposits or dividends.

Ensure your income from these three sources is less than 50 lakh rupees to use the ITR1 form.

Documents Required for Filing ITR

Keep these documents ready before you start:

1. Form 16 provided by your employer.
2. Details about your income from all sources.
3. Access to your Annual Information Statement (AIS). The AIS contains pre-filled financial information linked with your PAN.

Filing ITR1 Form

The filing process of ITR1 involves three steps:

• Validate the ITR1 return: Compare the pre-filled income and deductions in the ITR1 form with your records to ensure accuracy.
• Confirm your return summary: Post validation, confirm your income, deductions, and total tax paid.
• Verify the return and submit: After everything is confirmed, verify and submit your return.

Determining Old Tax Regime Vs New Tax Regime

One critical decision during the process is choosing the tax regime. You can use the inbuilt income tax calculator on the income tax portal to decide between the old and new tax regimes based on your income and deductions.

Handling Errors during ITR filing

While validating your return, if an error pops up, you need to correct it using the edit option before proceeding. If the error involves an income or deduction that doesn't apply to you, you can choose to delete it.

Final Verification

After verifying all the information, the final step is to verify your tax return. You can choose to verify your return immediately via OTP or later.

Should you face troubles at any stage, it's better to seek professional help. If you adhere to the steps and precautions detailed above, the seemingly formidable procedure of filing ITR can be simplified greatly.