- Date : 18/12/2020
- Read: 3 mins
Filing your income tax return may seem a cumbersome exercise, but thankfully you only need to follow a few simple steps.
Filing one’s income tax return (ITR) has always been considered a long and arduous process. This is why many people hire professionals to file it on their behalf. However, it is something you can do on your own by following a series of simple steps.
Here’s what you should do to file your ITR:
- Collect all the necessary documents: To file your ITR, you require some specific documents, such as Form 16/16A, salary slips, capital gains statement, etc. These forms play a vital role while filing your ITR as they show the tax deducted at source (TDS), thereby helping you calculate your gross taxable income.
- Download Form 26AS: This form gives you information on the TDS deducted from your income and deposited against your PAN. You must download this form and then verify the details from other TDS certificates to check if everything is correct and up to date.
- Correct errors (if any): In case of any incorrect values, you must consult your employer, bank, or others for clarification. Without getting the errors rectified, you will not be able to claim credit on the tax that has been deducted. You can also file a complaint with the Central Board of Direct Taxes (CBDT) if the TDS has been deducted but has not been deposited with the government.
- Calculate your total income: This includes your total income from five heads: salary, rental income, income from a business or profession, capital gains, and income from other sources. Add all of these incomes and the deductions as per the Income Tax Act of 1961.
- Calculate your tax liability: After you have your total income for the financial year, check which tax slab you fall under. Based on this, you can compute your tax for the year. You can also choose between the old and new tax slabs and arrive at an accurate figure.
- Compute the final tax payable: In this step, you need to deduct the taxes you have already paid, such as TDS, tax collected at source, and advance tax. If any interest is payable under sections 234A, 234B, and 234C, add this too. This will tell you if you need to pay any additional tax or if you have paid more tax than you need to.
- File the ITR: After all the taxes due have been paid to the IT department, you can proceed to file your return. Doing this within the stipulated time will also help you receive a refund in case of any excess tax paid. Remember to file your taxes even if it is not mandatory for you.
- Verify the ITR: This is the last step in the process. You can verify your return physically or electronically. For the former, send a signed copy of your ITR-V/acknowledgement to: The CPC, Post Box No. 1,
Electronic City PO,
Bengaluru 560 100.
Electronic verification methods include Aadhaar-based OTP, and an electronic verification code (EVC) via net banking, bank account, Demat account, and bank ATM.
After following the steps mentioned above, you will receive an acknowledgement of the ITR at your email address. Please note that due to the special circumstances of COVID-19, the deadline for filing income tax returns for FY 2019–20 has been extended to 31 December 2020.