Income Tax Return (ITR) filing is the process by which taxpayers report their income, deductions, and tax liability to the government. It's a mandatory annual task for individuals and entities meeting certain income criteria.
Here's a simplified step-by-step guide for filing an ITR in India:
Gather Documents: Collect all necessary documents such as Form 16 (issued by your employer), bank statements, investment proofs, etc.
Choose the Right Form: There are different ITR forms for different types of taxpayers. Make sure you select the correct one based on your income sources and other criteria.
Compute Income: Calculate your total income for the financial year from all sources, including salary, house property, capital gains, business or profession, and other sources.
Claim Deductions: Deduct eligible expenses under various sections such as 80C (for investments like PPF, LIC, etc.), 80D (for health insurance premiums), etc., from your total income.
File Online or Offline: Most taxpayers file their returns online through the Income Tax Department's e-filing portal. However, you can also file offline by submitting a physical copy of the return.
Generate XML: If filing online, prepare your return using the selected ITR form and generate an XML file.
Upload XML: Log in to the e-filing portal, navigate to the 'Upload Return' section, and upload the XML file.
Verification: After uploading, you need to verify your return. You can do this electronically using methods like Aadhaar OTP, net banking, or by sending a signed physical copy of ITR-V to the CPC Bengaluru within 120 days of filing.