Filing income tax returns is a crucial aspect of financial management, demanding meticulous attention to detail. To ensure a smooth and error-free process, it’s essential to follow a structured approach and adhere to relevant guidelines. Here are some key points to consider while filing your income tax returns.
1. Compilation of incomes and investments: The assesses should compile all of their incomes from salaries, house property, business & profession, capital gains and income from other sources. These information can be compiled from various sources such as Form 16/16A, bank statements, interest certificates, the investment receipts for claiming deduction/exemptions etc.
2. Reconcile the incomes with 26AS, AIS: The assesses should then download 26AS & AIS and compare them with their incomes In case of any discrepancies, they need to follow up with the concerned Deductor.
3. Select the income tax regime: The new tax regime has been set as default. The assesses should decide which regime they want to opt for. If the old regime is suitable to the assesses, they must file 10IE before filing income tax returns.
4. Select the appropriate applicable ITR form. There are 7 ITR forms in place as below:
- ITR-1: Applicable to Resident Individuals having income less than or equal to 50 lakhs from salary/pension, one house property and other sources
- ITR-2: Applicable to Individuals/ HUFs having income more than 50 lakhs from salary, more than one house property, capital gain, other sources, foreign income/assets. Also applicable to those being directors in company.
- ITR-3: Applicable to individuals/ HUFs having income all incomes from ITR2 and business income where books of accounts are maintained or audited. It is also applicable to partner in a firm.
- ITR-4: Applicable to Individuals, HUF and firm having presumptive income along with all incomes from ITR-1.
- ITR-5: Applicable to firms, LLP, AOP and BOI
- ITR-6: Applicable to companies other than those claiming exemption u/s 11.
- ITR-7: Applicable to trusts, charitable or religious institution, Political parties, Scientific Research Associations, Educational Institutions.
5. Correctness of other details: Please make sure all the details like PAN, address, contact details, bank accounts are correct in the ITR form. Also make sure PAN and aadhar are linked.
6. Make full and correct disclosure: The assesses should disclose their incomes and claim only those deductions or exemptions which they are actually entitled to. They should not claim any bogus deductions/ exemptions. The persons earning more than 50 lakhs need to fill the schedule of assets and liabilities. If the individual has asset in a foreign country or is a beneficiary of an asset in a foreign country, he/she must disclose them in the ITR. Those holding directorship in companies must also furnish the information of their directorship in the ITR.
7. Include all bank accounts: The assesses should include all of their operative bank accounts in their ITRs. Also make sure the bank account to which the refund is to be credited must be pre-validated.
8. Filing of ITR well before due date: The assesses should file their income tax returns well before the due date to avoid last time rush. The due date to file ITR is 31st July 2024 for individuals and non-audit cases and 31st October 2024 for audit cases. The consequences of delay in filing returns may attract late filing fees, losses not getting carried forward, deductions and exemptions not being available.
9. Verification of Income tax returns: Once the returns are filed, make sure to verify the return within 30 days, else the ITR filed will be treated as never filed. The ITR can be verified through e-Verification or by sending the hard copy to CPC, Income Tax Department, Bengaluru. E-verification is highly recommended to ensure smooth and fast processing of returns.
By considering these points, one can ensure a smooth and accurate income tax filing process, maximizing your deductions and minimizing the risk of errors or audits.
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