All the employees whose income is more than Rs 2,50,000 per annum have to file their tax returns to the Income Tax Department as per the norms of the Income Tax Act of 1961. This is usually done for reporting a taxpayers income earned during a particular financial year. To facilitate the taxpayers to file their IT returns, the income tax department provides a facility for electronic filing (e-filing) of an income tax return.
What is an Income Tax Return?
The Income Tax Return or ITR is a form which is used to file all the information related to the income of an individual to the Income Tax Department. Generally, the tax liability of a taxpayer will be computed based on his or her income.
The returns must be filed every year by the individuals, businesses which earn income for a financial year. The income could be in any form, salary or income from house property or capital gains or business profits or received dividend or interest or through any other sources.
If in case, if the returns show that extra tax was paid during a year, then the taxpayer will be eligible to receive an income tax refund from the department.
It is necessary to file the income tax returns before the set deadline failing to do so will attract penalty from the tax department.
Let's understand the process of How-to e-file Income Tax Returns on IT Department Portal?
Calculation of Total Income
An individual taxpayer or business houses have to first calculate their income as per the income tax provisions which apply to them. Calculate the total income earned through various means and arrive at the gross total income earned during a financial year.
Tax Deducted at Source (TDS) Certificates and Form 26AS
The taxpayers should compile their TDS amount out of the TDS certificates received for all the four quarters of a particular financial year and Form 26AS helps taxpayers to summarize the same.
Choosing the Correct Income Tax Form
It is essential and important to ascertain the income tax form or the ITR form applicable for the taxpayer for filing their Income Tax Returns. After choosing the correct income tax form, they should proceed with filing their income tax returns.
The Income Tax Department has provided taxpayers with an opportunity to either file their tax offline or via online mode. Through offline mode, it is by generating XML and uploading the form. If it is through online, it is available only for ITR1 and ITR4 (for other taxpayers' other categories of forms are not available).
Downloading ITR Utility from Income Tax Portal
For downloading the ITR utility one has to visit the official web portal of Income Tax e-Filing and choose the ‘IT Return Preparation Software' option which can be seen on the right side of the menu, under Download.
Now choose the assessment year and download the offline utility software (either Java or Microsoft Excel) based on your convenience.
Enter all the Details in the Downloaded File
After downloading the offline utility, duly fill in all the relevant information related to your income, check for the tax payable or the refund receivables based on the calculations of the utility. In the downloaded form, the required details of the income tax challan can be filled in.
Now Validate the Information
Now you will have to validate the information which you have provided by clicking on the ‘Validate' button to ensure that all the details provided are accurate. The Validate button can be seen on the right-hand side of the downloaded form.
Convert the File to XML Format
After successfully validating the details, click on the ‘Generate XML' button which is present on the right-hand side of the file to convert the file into an XML file format.
Upload XML Formatted File on Income Tax Portal
Post conversion of the file to XML format upload the same on the Income Tax Portal by logging into the income tax e-filing website. Click on the ‘e-File' tab and select the ‘Income Tax Return' option. Enter all the relevant details like Assessment Year, PAN Card number, ITR Form Number and the mode of submission.
Note: Do remember to choose the ‘Upload XML' form from the drop-down list corresponding to the field name ‘Submission Mode'.
Attach the XML file saved in your computer and click on the ‘Submit' button. Choose one of the available verification modes either Electronic Verification Code (EVC) or Aadhaar OTP or Send the manually signed copy of the Income Tax Return - Verification (ITR-V) to the Central Processing Centre (CPC) of the Income Tax Department.