Income tax filing season is here again, folks!
The last date for filing your tax return in July 31, 2017 and with just over a month to go, it is a good time to get your income/expense documents and bank statements in order to avoid any delay. Most of you would have received the Form 16 from your employer by now, so here’s a step-by-step guide to file and verify your income tax return for FY 2016-17.
1. Documents to have
- Form 16 is issued to salaried employees and 16A to professionals, usually between April-June
- Should only be generated via the TRACES website (TDS Reconciliation Analysis and Correction Enabling System)
- Check it thoroughly for discrepancies and get it corrected as needed, at the earliest
- Lists payments (including salary income) made to you in the financial year along with tax deducted and paid
- Includes entries from employer, client, bank/any other entity who has made a payment to you and deducted tax on it
- Includes any advance tax or self-assessment tax paid by you during the financial year
- Download from TRACES website, or your bank’s Netbanking interface by clicking on “View Tax Credit Statement’
Statements of income and tax-saving investments
- Salary slips and Form 16/16A
- Income from dividends, interest and sale of investments
- Income from sale of property and any other income earned by you during the year
- If salaried, you would have already given proof of tax saving investments to your employer
- Exceptions like donations to approved institutions can be included while filing returns
Expenses and Reimbursements
- If salaried, most reimbursements are taken into account by employer
- If freelancing or self-employed, part of some expenses like fuel, electricity, broadband can be claimed as a deduction
- Depreciation can be claimed on your computer, laptop, phone, tablet, vehicles, any other devices used in business
You don’t need to actually submit these documents to the Income Tax Department – however, you should keep them handy in case there is a query during scrutiny of your return.
2. Which ITR form to fill
Depending on your category as a taxpayer, there are different ITR forms:
Individuals with Income from Salaries, one house property, other sources and total income upto Rs.50 lakh
Individuals and HUFs not carrying out business or profession under any proprietorship
Individuals and HUFs having income from a proprietary business or profession
Presumptive income from Business & Profession
Persons other than (i) individual, (ii) HUF (iii) company and (iv) person filing Form ITR-7
Companies other than companies claiming exemption under section 11
Persons including companies required to furnish return u/s 139(4A), (4B), (4C), (4D), (4E), (4F)
You can download the ITR form, or fill online as applicable.
3. Linking Aadhaar with PAN and adding Aadhaar/enrolment number in the ITR form
The Supreme Court recently gave its judgement on Section 139AA of the Income Tax Act on linking Aadhaar with PAN, upholding part of it, and granting a stay on the provision that stipulated invalidating of PAN if not linked to Aadhaar.
– If you are filing your return by June 30, 2017 and have an Aadhaar/enrolment number, no need to mention it on the form
– If you file your return from July 1, 2017 onwards and have an Aadhaar/enrolment number, it is mandatory to mention it in the ITR form. Here are 4 ways to link Aadhaar with PAN. The Income Tax department has also shared a form to do so manually, which is available here.
– If you do not have an Aadhaar or enrolment number as of now, there is no need to get one immediately. You can still file your return without mentioning the Aadhaar number *
* Update: As per their circular dt. 29-Jun, the Income Tax department has said those allotted PAN as on 01-Jul and required to intimate their Aadhaar number while filing returns must do so, and have notified the procedure and format for intimating Aadhaar number to the I-T Department by PAN holder and quoting the same in PAN applications.
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4. Calculate tax liability or refund eligibility as applicable
If you have other income on which tax is payable beyond that subject to TDS, or expenses which you can adjust to claim a refund, calculate your actual tax liability for the year as you’re filling in the ITR form itself, or use this calculator. If any additional tax is payable, you can pay it here as Self-Assessment tax.
5. File your return
- Once your ITR form is completed, generate an XML file from it and save it on your computer
- Log in to the Income Tax Department’s e-filing website or register if you’re a new user
- Upload the saved XML file to generate an acknowledgement, known as ITR-V
6. Verify your return
- Offline – download, print and sign ITR-V in blue ink, send it to CPC Bangalore within 120 days of filing your return
- Online – there are four ways of verifying your return online
- EVC – 10 digit Electronic Verification Code that is valid for 72 hours
- Netbanking – After logging in, select ‘income tax e-filing’, select return to verify from IT site
- Aadhaar OTP – If your Aadhaar number is linked to PAN and your mobile number is linked to Aadhaar
- Bank account validation – Validates account number, IFS Code, email id & phone number against details with the bank