E-filing of Income Tax Return: Why is it Important?

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Steps for E-filing income tax

Income tax is a direct tax that levies by the government on the citizens according to their income slabs. The money collected in the form of income tax used for different purposes like healthcare, infrastructure, transportation, and industrial development. Gone are the days when filing an income tax was a daunting task, and people have to visit the Income-Tax Department to file the return.  In order to ease the process of filing income tax, the government of India introduced e-filing mode. Let’s understand more about it.

What is Income Tax E Filing?

Income tax return means filling a form in a prescribed manner that shows your income, expenses, and other earnings and requests the Income Tax Department to refund the overpayment of taxes.  When you fill an electronic form available online for filing your income tax return for the particular year, it is called e-filing. You can do it either by using Digital Signature Certificate (DSC) or Income Tax Return-Verification form or via Aadhar card. It is a simple and quick process and blessings for taxpayers, especially during the coronavirus outbreak. 

Why E Filing of Income Tax is Important?

E-filing of income tax return is important to taxpayers for below reasons:

• Quick and simple processing
• Prompt confirmation with receipt 
• Seamless with high accuracy 
• Maintain confidentiality 
• Easy access to past data
• Apply easily for any type of loan
• Apply for credit cards and returns
• Pre-requisite for visa processing  
• Tax exemption on health insurance premium 
• User-friendly software
• Available 24x7

What are The Steps for Income Tax E Filing?

E-filing is an easy process that you can do while sitting at your home due to the corona lockdown. Let’s check out the simple steps you need to follow for e-filing your tax return:

• You need to get register to start the process.
• Visit the Income Tax E-filing portal for registration.
• Select the “User type” such as Individual, HUF, etc.
• Now enter the required details like PAN, Date of Birth and residential status, contact number, etc.
• Click on the “Submit” button.
• Soon you will get a 6 digit One Time Password (OTP) on your registered mobile number and email ID and you need to enter that for e-filing login.
• Now after registration, enter your login details to the Income Tax E-filing portal
• Click on the “Income Tax Return” option given under “e-file.”
• Then select the assessment year and click on “Continue.”
• For verification purposes of the Income Tax Return, you need to select the authentication type that can be through Aadhaar OTP, EVC using Pre-validated bank details or you can also send signed ITR-V through normal or speed post and click on “Continue” button.
• Read the instructions carefully before e-filing online process.

Now under part A: You have to fill basic personal information such as Name, PAN Number, Aadhar Number, Address, Email ID, and so on.

• Now, fill all the income and deduction details for income tax computation
• You will get the details related to tax already paid, tax amount payable, and refund amount under the “Taxes Paid and Verification” section.
• Under sections “80G” and “80D” you can claim deductions also.
• After all the steps click on the “Preview and Submit” option to cross check the given details.
• If you find all the details are filled correctly then click on the “Submit” button or e-verify the same.
• After successful e-verification, you will get an acknowledgment receipt on your registered email ID.

Nutshell

In this way, your e filing of income tax can be done hassle-free. However, under section 80D of the income tax act, you can also claim tax reduction on health insurance premium. So, if you already have it, then claim for it, but if not, then opt for a comprehensive health insurance plan offered by Care Health Insurance now. With a little investment in health insurance, you can save your health as well as hard-earned money.

Disclaimer: The above information is for reference purposes only. The tax exemptions are subject to the rules and regulations of the Income Tax Act of India 1961.

>> Also Read: 5 Income Tax Compliance Relaxations Taxpayers Should Know