Why Oh Why does this time of the year keep coming. Oh those income tax returns have to be filed again. What a headache. So you think you are the only one filing those blessed income tax returns. Speaking of tax returns I remember an incident that once happened to me. I always make it a point to file my income tax returns on time especially if I am getting my tax refunds. Remember from the sublime to the ridiculous is just one step. I made a mistake while filing the income tax refund returns as I was not very familiar with the online Income Tax filing procedure .I had to file my revised returns. Consequently my refund got delayed. So I would advice my readers never take “The Filing Of Your Income Tax Returns Lightly”. I would like to remind all of you that the team of Financial Planners at IndianMoney.com are always there for you to plan your Tax Planning needs in a most effective and efficient manner. You can explore this unique Free Advisory Service just by giving a missed call on 022 6181 6111.
So How Do You Go About Doing This?
Step - 1
"Thought Is The Seed Of Action"
Assimilate your thoughts and begin assembling all the relevant documents you need.
- Collect the Form 16 which contains information on your salaried income and the amount of tax deducted from your salary.
- Form 16A is a TDS Certificate which certifies the amount of TDS deducted. Over the course of a year you would have conducted a number of business transactions. You would need to collect this form from all the people who have deducted tax while making payments to you. This may be necessary if you have rented out your property.
- Collect and summarize all the bank account statements showing the necessary income and expenditure.
- If you have bought property you would require details of rent collected, if any municipal tax paid, and if this property is bought on a loan , the loan details and a copy of the certificate showing interest paid.
- All documents pertaining to sale and purchase of assets as well as the documents showing investments made and if necessary, prepare a profit and loss account before calculating the taxable income.
Step - 2
- In life we are faced with a number of choices. Here we use decision making skills. This is basically making of the right choice when there are a number of choices to be made. Don’t we all fret when we have to make those difficult decisions in life? Career Oriented Decisions or decisions made in life threatening situations.
- Here we have to choose the right Income tax return form.
- ITR -1: Income from salary or pension, Family Pension, Income from agricultural activity. Income from one house or property, interest received (taxable/exempt).
- ITR -2 : Income from salary or pension, Income from house or property, Income from other sources and winning a lottery or a horserace.. Earning through short and long term capital gains.
- ITR -3 : This is used by an individual who is a partner in a firm. Here he gains income through interest, salary, bonus, commission, remuneration received from the firm or by virtue of being a partner in the firm.
- ITR -4 : This is applicable both to individuals and HUF who carry out a business or a professional activity in addition to having sources of income applicable to ITR -3.
- ITR -V : This is basically a verification form for the taxpayers which serves as an acknowledgement form.
See Also: Section 54 of Income Tax Act
Step - 3
Here you can file your returns physically or electronically. Take a print out of the respective ITR Form along with acknowledgment form ITR-V and file it with the income tax officer.
E-Filling Of Income Tax Returns
This is a process of electronically submitting the income tax returns to the Income tax department.
Manual Calculation :
Those that allow you to enter the income tax data but do not calculate the income tax and tax refunds.
Automatic Calculation :
Those that allow you to enter the income tax data and automatically calculate the income tax and tax refunds.
Signing The Income Tax Returns :
An ITR is an important document and must be signed manually or digitally.
How Is It Done
- Firstly select the form that is suitable for you, say if you are a Doctor with your own clinic ITR-4 will apply to you.
- Download the form and fill up all the relevant details regarding income, losses and do it offline. Once you are done you must validate these by clicking on the "Check Form" Button.
- Once you have filled this form offline proceed to generate an XML file out of it by clicking on Export To Excel.
- If you are e-filing your returns for the first time you need to register yourself creating a user id and a password on the website https://incometaxindiaefiling.gov.in. Use your user id and password and log unto the portal. Browse and select your offline XML file and upload it on the site .Now you will have to attach the digital signature and file your returns.
- Remember to print The ITR –V an acknowledgement slip which is generated after filing the income tax returns online.
Benefits Of Using E-filing Route
- Under this method tax returns can be calculated and processed very fast and refund claims are processed very quickly.
- A very high degree of accuracy is obtained.
- These returns can be filed from anywhere and at anytime providing for great flexibility , speed , time boundaries and geographical boundaries are not a factor.
- Easy access to data and storage of all relevant data and documents for future use.
- Remember those long queues at the Income Tax department when you had to file your returns. All these hassles are removed through the e-filing process.
What Happens If I Could Not File My Returns On Time?
Let us consider the case where you have already paid all your taxes before March 31st 2011.but could not file the returns within the due date. Here for the financial year of 2010-2011 returns can be filed before March 31st 2013.However you might incur a penalty if the returns are furnished after March 31st 2012.
See Also: How To Reduce Income Tax In India?
Here let us consider that you did not get that income tax refund because your tax returns were filed incorrectly. We would like to revise these returns. The following cases show us how to file the revised returns.
Steps To File Revised Tax Returns
- Open the Excel file in which you have filled original return.
- Enable Macros.
- Update and Do the necessary corrections.
- Mention the return as a revised return
- Here we have Section 139 (5) for omissions or wrong statements.
- Fill the acknowledgement and the date of original ITR-V downloaded after filing of the original return.
- Click compute tax again .Validate each sheet .Generate a new XML file and upload it on the Income Tax India e-filing site after loging into the portal using our earlier generated user name and password found during the original e-filing.
- Download revised ITR-V and sign it.
- Send Old and New ITR-V to the CPC Bangalore Office at Electronic City.
When Must You File The Revised Returns?
- Pan Number is incorrect.
- Gender is filled incorrectly
- Residential Status is wrong.
- TDS Details are incorrect
- Incorrect bank details or an incorrect MICR Code
- Incorrect advance tax and self assessment tax deposit details.
I would like to end this article by stating not only how important it is to file our returns on time but also in case of an error how to rectify this by filing revised returns. Here it would be wise to remember the great saying “A Bad Beginning Makes A Bad Ending” .Here we can read up the website IndianMoney.com in order to understand our tax saving and tax planning needs.