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Income Tax E-Filing
 

E-filing of Income Tax Returns (ITR) in India is the process of submitting your income tax details to the Income Tax Department online. It's a convenient and efficient way to fulfill your tax obligations.

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Who is required to E-file?

Generally, individuals and entities whose total income exceeds the basic exemption limit are required to file an ITR. The basic exemption limits vary based on age and income category.

  • Individuals under 60: Income exceeding ₹2.5 lakh (Old Tax Regime) or ₹3 lakh (New Tax Regime).

  • Senior citizens (60 to 80 years): Income exceeding ₹3 lakh (Old Tax Regime) or ₹3 lakh (New Tax Regime).

  • Super senior citizens (80 years and above): Income exceeding ₹5 lakh (Old Tax Regime).

  • Firms and companies: Must file ITR irrespective of profit or loss.

  • Other conditions for mandatory filing:

    • Investing in foreign assets or earning from foreign assets.

    • Spending more than ₹1 lakh on electricity consumption in a financial year.

    • Depositing more than ₹1 crore in one or more current accounts.

    • Spending more than ₹2 lakh on foreign travel.

    • Business turnover exceeding ₹60 lakhs, or professional receipts exceeding ₹10 lakhs.

    • Aggregate TDS & TCS amounting to ₹25,000 (₹50,000 for senior citizens).

    • Cumulative deposits in one or more savings bank accounts exceeding ₹50 lakhs.

 

Benefits of E-filing

  • Convenience: File from anywhere, anytime, 24/7.

  • Time and Cost Saving: Faster processing and reduces paperwork.

  • Accuracy: Built-in validations minimize errors.

  • Faster Refunds: Refunds are processed more quickly.

  • Proof of Income and Address: ITR acts as a valid document for various purposes like loan applications, visa processing, and insurance.

  • Carry Forward Losses: Allows you to carry forward losses to offset future income, reducing tax liability.

  • Avoid Penalties: Timely e-filing helps avoid late filing fees and other penalties.

  • Financial Credibility: Demonstrates financial transparency and responsibility.

 

Registration Process for E-filing

Before you can e-file, you need to register on the Income Tax e-filing portal (incometax.gov.in).

  1. Visit the e-Filing Portal: Go to the official Income Tax e-filing website: https://www.incometax.gov.in/iec/foportal/

  2. Click on "Register": On the homepage, find and click the "Register" button.

  3. Select Taxpayer Category: Choose "Taxpayer" (or "Others" if you are a Chartered Accountant, Tax Deductor, etc.) and click "Continue".

  4. Enter PAN: Provide your Permanent Account Number (PAN) and click "Validate". If your PAN is already registered or invalid, an error message will be displayed.

  5. Basic Details: Enter mandatory details as per your PAN, including Name, Date of Birth/Incorporation, Gender (if applicable), and Residential Status. Click "Continue".

  6. Contact Details: Enter your Primary Mobile Number, Email ID, and Address. Click "Continue".

  7. OTP Verification: Two separate One-Time Passwords (OTPs) will be sent to your primary mobile number and email ID. Enter these 6-digit OTPs and click "Continue".

    • Note: OTPs are valid for 15 minutes, and you have 3 attempts.

  8. Confirm Details: Review all the entered details. Edit if necessary, then click "Confirm".

  9. Set Password: Create your desired password. It should be 8-14 characters, include uppercase and lowercase letters, a number, and a special character. Set a personalized message. Click "Register".

  10. Successful Registration: A success message will be displayed. You can then click "Proceed to Login" to access your e-filing account.

 

E-filing Process (General Steps for Individuals)

The process can vary slightly depending on the ITR form applicable to you (e.g., ITR-1, ITR-2, ITR-3, ITR-4).

  1. Gather Necessary Documents:

    • PAN Card

    • Aadhaar Card (and linking PAN with Aadhaar)

    • Bank account details (for refund credit)

    • Form 16 (for salaried individuals, issued by employer)

    • Form 16A/16B/16C (for TDS on non-salary income, property sale, rent)

    • Bank Statements/Passbooks (for interest income, etc.)

    • Investment proofs (for deductions like Section 80C, 80D)

    • Home loan interest certificates (if applicable)

    • Capital gains statements (if applicable, for ITR-2/3)

    • Form 26AS and Annual Information Statement (AIS)/Taxpayer Information Summary (TIS) – these are crucial for reconciling your income and TDS details.

  2. Determine the Correct ITR Form: The Income Tax Department provides different ITR forms based on your income sources and residential status.

    • ITR-1 (Sahaj): For resident individuals with total income up to ₹50 lakh from salary, one house property, and other sources (excluding lottery/racehorses, and agricultural income up to ₹5,000).

    • ITR-2: For individuals/HUFs not having income from business or profession, but with capital gains, more than one house property, foreign income/assets, etc.

    • ITR-3: For individuals/HUFs having income from profits and gains of business or profession.

    • ITR-4 (Sugam): For resident individuals, HUFs, and firms (other than LLP) with total income up to ₹50 lakh and having income from business and profession computed under presumptive taxation schemes (Sections 44AD, 44ADA, 44AE).

  3. Calculate Income and Tax: Compute your total income, deductions, and tax liability. You can use online tax calculators or seek professional assistance.

  4. Login to e-Filing Portal: Use your PAN (User ID), password, and Date of Birth/Incorporation to log in.

  5. Choose Filing Mode:

    • Online Mode (Prepare and Submit Online): This is generally available for ITR-1 and ITR-4. You fill details directly on the portal.

    • Offline Mode (Upload XML): For other ITR forms (ITR-2, ITR-3, ITR-5, ITR-6, ITR-7), you need to download the offline utility (Java/Excel utility), fill in the details, validate it, generate an XML file, and then upload it to the portal.

  6. Fill in Details:

    • Most personal details and some income information (from Form 26AS and AIS) will be pre-filled. Verify these details carefully.

    • Enter all sources of income, deductions, and taxes paid.

    • Ensure all bank account details are pre-validated.

  7. Preview and Submit: Review the entire form for accuracy. If there's any tax payable, make the payment and enter the challan details. Then, submit the return.

  8. E-Verify the Return: This is the most crucial step. Your return is not considered filed until it's verified. You have several options for e-verification:

    • Aadhaar OTP: Generate an OTP on your Aadhaar-registered mobile number.

    • Net Banking: Verify through your bank's net banking portal.

    • Bank Account EVC: Generate Electronic Verification Code (EVC) through a pre-validated bank account.

    • Demat Account EVC: Generate EVC through a pre-validated Demat account.

    • ATM EVC: Generate EVC through your bank's ATM.

    • Sending ITR-V to CPC: If you cannot e-verify, you can print, sign, and send the ITR-V (Acknowledgement) to CPC, Bengaluru via ordinary or speed post within 30 days of filing. However, e-verification is highly recommended for faster processing.

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