Income Tax Returns (ITR) filing is a job that needs close attention. At the time of filing your ITR, the salaried person in particular is required to keep a few important considerations in mind. This crucial information would have been clarified in this extensive manual.
1. Determining the Right Tax Return Form
The initial step is to find out the correct ITR form for your tax concern. Towards the Assessment Year (AY) 2023-24, ITR – 1 or Sahaj, is subject to the resident individuals with a total income that incorporates:
- Salary or pension income
- Additional Income sources (except lottery winnings and income from racehorses)
- Income via the one-house property (except the cases where loss is carried forward through the previous years)
- Agricultural income up to Rs 5000
While ITR-2 would be for the individuals or Hindu Undivided Families (HUF) whose total income includes:
- Salary or pension income
- Overseas Income or assets
- In a company individuals holding directorship.
- Capital gains Income
- Multiple properties Income
- Income from Agricultural of more than Rs 5,000
- Lottery winning income and the income incurred via racehorses.
- As a resident not ordinarily resident (RNOR) and non-resident
- Unlisted equity shares investments at any point of time in the fiscal year.
2. Comprising All Additional Incomes
You should be careful to include all additional income, such as bank interest, interest on fixed deposits, capital gains, rental income, and shares income. Authenticate and make sure that your ITR accurately reflects all of these sources of income.
3. Form 16 Analyzing
Form 16 is a TDS (Tax Deducted at Source) certificate issued by your employer outlining your salary income and tax deducted. Check the salary and deductions shown on Form 16 against Form 26AS and your evidence. Check for deductions such as self-occupied house property interest and 80CCD(1B) NPS, which you might not have provided to your employer but can still claim.
4. Select B/W Old and New Tax Regime
The Government of India launched a revised optional tax regime in Budget 2020. Under this, individuals can select lower tax rates on the terms of forgoing particular exemptions and deductions available under the old regime. It is imperative to compare the tax liabilities under both regimes and choose the one that benefits you.
5. Examine All Tax Deductions
Making it certain that all deductions are examined thoroughly opposing the evidence you have. In some scenarios, your deductions may not be present in Form 16, leading to excess tax deductions. In such cases, you can claim these deductions while filing your ITR. Avoid reporting any fictitious deductions that you didn't make throughout the fiscal year.
6. Easy Download & Validate Form 26AS, AIS, and TIS
The tax that gets deducted from your income and deposited with the government through your deductor would have been represented in your Form 26AS tax credit statement. Additional details regarding your financial transactions are been included in your AIS (Annual Information Statement) and TIS (Tax Information Statement). Whether all entries in such forms are accounted for in your ITR must get verified by you.
You must note that when the specific income would get specified in such forms but does not relate to you then you are enabled to overlook the same. During that time in these forms when certain income does not get shown then it needs to get reported in your income tax return.
7. Do Not Hurry While Filing
It is one of the most common mistakes that people make while filing their ITRs. They wait for the last date and at the end, they rationalize the task filing in a hurry. Such mistakes may lead to several other errors, which might lead you to file wrong or receive notices from the Income Tax Department. Therefore, take your time to thoroughly read the Form you are applying for filing. It is even better not to wait for the due date and do the process before the deadline hits you. Reaching out to tax professionals for any help is also the best move.
Conclusion
Finally, remembering these safety measures will enable you to efficiently and accurately file your ITR. Keep in mind that paying taxes is about more than just following the law; it's also about helping the country advance. There are many issues that taxpayers may encounter when filing their income tax returns online. SAG Infotech Private Limited's main moto is to give useful information to easily sort out such kinds of problems. Always, the company spreads accurate details to taxpayers.
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