Income Tax Return

Steps for Filling Income Tax Return

The Income Tax Department now accepts electronic submission of tax returns. Before learning how to electronically submit an income tax return, a taxpayer is required to keep records for ITR computation and reporting.

Step 1: Calculate your income

The taxpayer is responsible for researching the laws that govern income tax.

Consideration should be given to a variety of potential sources of income, including a salary, commissions, and interest on investments. Under Section 80C, the taxpayer is eligible to deduct tax-saving investments.

TDS, TCS, and any advance tax paid by a taxpayer must all be considered.

Step 2: Requirements include Form 26AS and tax deducted at source (TDS) certificates.

The taxpayer should figure out his total TDS for the year using the TDS certificates that he has received for each of the fiscal year's four quarters. The taxpayer is required to file Form 26AS in order to get a summary of their TDS and tax payments for the year.

Step 3: Choose the appropriate income tax form

Before reporting taxes, the person must choose which ITR form to fill out. You have the option of submitting your taxes either online or offline. Only Forms ITR 1 and ITR 2 may be submitted electronically. For all other income tax forms, offline submission is necessary (by producing an XML file and downloading it).

Step 4: Go to the Income tax portal and download the ITR software.

Choose "Downloads" from the main menu of www.incometax.gov.in.

Download the offline tool, input your income details, and see the anticipated tax or refund that will be due. The information from the income tax challan should be used to complete the form that is attached.

Step 5: Check entered data

There are a few buttons on the right side of the downloaded form. Click "Validate" to confirm that all required fields have been filled out.

Step 6: Convert the file to XML Format

To produce an XML version of the file when validation is finished, click the "Create XML" button that is located in the top right-hand corner of the file.

Step 7: Upload your XML file to the income tax portal

After entering into the online income tax filing system, choose "Income Tax Return 2" from the "e-File" option.

The ITR form number, tax year, and PAN are all necessary. As can be seen below, "Upload XML 2" is an option in the "Submission Mode" drop-down menu.

Step 8: After selecting the XML file to upload from your own computer, click "Submit."

Aadhar One-Time Password (OTP), Electronic Verification Code (EVC), or sending a signed ITR 2 to CPC, Bangalore, are all possible means of verification.

What Are Some Strategies to Save Income Tax?

Tax planning might reduce income tax. The Income Tax Act enables taxpayers to reduce their taxable income and their tax obligations by taking advantage of deductions and exclusions. This is a list of the most common tax exemptions and deductions:

• Under Section 80 C, you may deduct up to Rs 1.5 lakh for things like investments in ELSS, LIC, mutual funds, paying for your children's education, and the interest on your home loan.
• Contributions to Central Government National Pension Schemes are entitled to an extra deduction of Rs 50,000 in 80 CCC above Rs 1.5 lakh (1b).
• According to Section 80D of the Internal Revenue Code, taxpayers may deduct the cost of health insurance premiums for themselves, their spouse, their dependent children (up to the age of 26), and their dependent parents (up to the age of 65).
• Donations to organizations and trusts that meet the requirements of Section 80G are eligible for a tax deduction.
• If you have less than 10 children, your housing allowance can be lowered (13A)
• Loans for higher education that are eligible for the 80E deduction
• For homes that are owner-occupied, the deduction for a house loan under Section 4 is limited to 2 lakh, while it is limitless for properties that are rented out.

What Is Form 26AS?

Form 26AS is an important record that reveals the percentage of tax that was withheld at the source from payments and investments made by individuals, workers, and independent contractors. As a result, taxpayers are now able to apply for a refund of any taxes that they overpaid or underpaid.

The new Form 26AS, which will go into force during the financial years 2020-21, has been updated to make it simpler to submit tax returns online and to promote compliance with any relevant tax responsibilities.

Financial transaction statements are an essential component of the newly revised Form 26 AS. As the name suggests, these are statements in which the taxpayers recollect any significant financial transactions that could be advantageous to them when paying taxes.

Your Aadhar card information, date of birth, email and physical addresses, as well as your mobile phone number, will all be shown in the new 26AS format. It will tell whether or not any tax processes with the tax authorities are now ongoing or closed, and it will also indicate whether or not any tax proceedings have been resolved.

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