How to file income tax returns online: ITR efiling made easy, here's is how

How to file income tax returns online: We are at the fag end of the financial year 2017-18 and 31 March 2018 is the last date by which one can file the belated income tax returns pertaining to financial year (FY) 2015-16. Further, effective from FY 2016-17, the time period for filing the belated tax returns has been reduced and as such, the last date for filing belated return for FY 2016-17, as well is 31 March 2018. As the tax compliance is getting tighter, it would be advisable to ensure timely filing of tax returns, to avoid any penalty and prosecution proceedings.

As per the Income-tax Act, all the companies and firms have to file the return irrespective of quantum of income or activity level. All individuals, HUFs and other persons whose total income exceeds basic exemption limit (before deductions under chapter VIA such as section 80C/80CCD/80DD/80TTA) have to mandatorily file return of income in the prescribed ITR form.

Any assessee filing ITR 1/2/2A having total income of more than Rs. 5,00,000 or having a refund claim is required to furnish the return of income electronically with or without digital signature or by using electronic verification code. 

In case of firms, individuals and HUFs whose books of accounts are required to be audited and in case of all corporate taxpayers, e-filing with digital signature is mandatory. However, super senior citizens (age of 80 years or more) are exempted from e-filing unless they have business income. 

The e-filing process of the income tax return is as under:

1. Pre-requisites for e-filing of income tax returns

The pre-requisites are: (a) Permanent Account Number (PAN), (b) Registration at e-filing portal, (c) and linking of PAN and Aadhaar Number, which is mandatory.

2. Step by Step Process for e-filing return

Registration

Taxpayer must be registered on E-filing portal (www.incometaxindiaefiling.gov.in) where income tax return has to be uploaded. While registration, category of person (individual, firm, company. etc.), PAN, address, Mobile No, e-mail id etc are required to be filled in for verification. The registration shall be complete on e-verification of the taxpayer id through OTP shared via registered e-mail id as well as registered mobile no.

Selecting the appropriate income tax return form

There are separate tax return forms prescribed depending upon the type of assessee and type of income earned by them. For instance, for the AY 2017-18, individuals having Income from Salaries, one house property, other sources (Interest etc.) and having total income upto Rs.50 lakh can file Form ITR 1. Individuals and HUFs, other than those mentioned above and not carrying out business or profession under any proprietorship are required to file ITR 2 whereas those having income from a proprietary business or profession must file in Form ITR 3. 

Similarly, there are other forms prescribed for partnership firms, trusts, companies etc.

The above forms are available in excel and java utilities which can be downloaded and filled offline. However, person to whom ITR 1 and ITR 4 (presumptive taxation) is applicable can file their Income tax returns completely online on income tax website and there is no requirement to download any utility or software.

Filling necessary details in the ITR

Before filling the return, Form 26AS must be downloaded from the E-filing portal, which contains the details of tax paid in the form of TDS, Advance tax or Self-Assessment tax, to avail appropriate credit for taxes paid. The details pertaining to all the sources of income earned during the year are to be filled in the form. 

Also, details of all bank accounts and the bank account for receiving refund of tax must be mentioned in the ITR. In case of resident taxpayers, all details of foreign bank accounts and other foreign assets must also be disclosed. If the total income is more than Rs 50 lakhs, then details of the assets and liabilities in Schedule AL in the relevant ITRs need to be furnished.

Generating XML file

The tax payable or refund, if any, can be duly verified by using an auto tab online or in the offline utilities. If all the mandatory details are filled in and post verification of the taxes, a valid xml file is to be generated, which can be uploaded on the income tax website.

Uploading and E-Verification of the return

The valid xml file generated has to be uploaded on E-filing portal with or without using digital signature, as the case may be. If the return is uploaded using DSC, one need to only preserve the acknowledgement and no further action is required. However, where the return is filed without DSC, the acknowledgment i.e. ITR V is required to be verified.

Verification of returns can be completed by using (a) Aadhaar OTP (b) Electronic Verification Code (EVC) or (c) sending signed acknowledgement physically to CPC-Bengaluru (within 120 days of filing the return).

Please note that the tax filing process is incomplete and the ITR shall be treated as invalid unless your ITR V is verified by either of the aforementioned options. The e-filing process is not only convenient but results in swift processing of the Income Tax returns and issue of refunds.

(By Suresh Surana, Founder – RSM Astute Consulting)