As a taxpayer you need to report your tax liability accurately and timely, in order to avoid any kind of trouble with the Income Tax Department. To be eligible to claim a refund you need to be mindful of the income tax return deadline. The due date depends on the taxpayer as well. For example, as a salaried individual, you need to file your taxes before 31st July 2023, whereas for corporations the date to file returns is 31st September 2023. You also need to know that missing the income tax return deadline can have serious consequences. You will not only have to pay a penalty but also lose out on a number of other advantages such as carrying forward losses, opting for the new regime etc.
What is Income Tax Filing?
Income tax return means filling out the income tax return 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, if any.
Who Should File ITR?
According to the Income Tax Act, ITR filing is mandatory for individuals whose annual income exceeds a specified limit. The limit is Rs 2.5 Lakh for those below 60 years, Rs 3 Lakh for senior citizens below 80 years and Rs 5 Lakh for super senior citizens above 80 years. Companies and firms must file ITR if they incur income or loss in a financial year.
If your total income for a financial year is less than the basic exemption limit, it is not compulsory for you to file an ITR. The exemption limit will be dependent on the tax regime that you have chosen. However, even if you have no tax liability, which is called a Nil ITR, you should still file an ITR. It is a prudent thing to do as it brings your name on record for the income that you have received for that particular financial year.
Apart from that filing an ITR regularly puts you in good standing. It makes getting loans and credit cards easier, claiming a TDS refund is simpler, and it can also be a helpful document when applying for a scholarship or an international visa.
Things to Know about the New Tax Regime
The Union Budget 2023, increased the basic exemption limit to Rs 3 lakh, which was Rs 2.5 lakh earlier. However, if you choose the new tax regime, the limit is Rs 7.5 lakh, as you will be eligible to claim rebates and deductions.
- As salaried people and pensioners, you do not have to pay income tax if your annual income is less than Rs 7.5 lakh if you choose the new income tax regime in Financial Year 2023-24.
- The rebate limit under section 87A has been raised to Rs 25,000 from Rs 12,500. This rebate, however, is only for individuals and not HUFs, NRIs and firms.
- As salaried individuals, pensioners, and family pensioners, you’ll also be able to enjoy a standard deduction of Rs 50,000.
How to File Tax Returns?
One can file tax returns through either the online or offline mode. One can also seek assistance from a professional. Before filing ITR, one is required to obtain Form 16, also called the income tax return forms, from the employer and have all the investment proofs.
Offline ITR Filing
One should also know the process of how to file ITR through offline mode. Those filing ITR through this method should furnish their ITR returns in physical paper form to the Income Tax Department.
Note: For individuals (including HUF members) with income below Rs 5 Lakh, who’re not eligible to get a refund, as well as super senior citizens have the option to file ITR through offline mode during a financial year.
E-Filing
The government has made a taxpayer’s life easy with the introduction of the e-filing system. The Income Tax (I-T) Department enables taxpayers to conveniently file ITR through an online portal. This minimises paperwork and makes the process error-free.
Briefing Income Tax E-Filing
Gone are the days when filing income tax was a daunting task and people had 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 the e-filing mode. When the tax filing process is done online by filling up an online form for a particular year, it is called e-filing. You can do it either by using Digital Signature Certificate (DSC) or ITR Verification form or via an Aaadhar card. It is a simple and quick process and a blessing for taxpayers.
Why is E-Filing of Income Tax Important?
E-filing of income tax returns 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?
Let’s check out the simple steps you need to follow for e-filing your tax return:
- You need to 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 ITR verification purposes, you need to select the authentication type that can be through Aadhaar OTP, or EVC using Pre-validated bank details or you can also send a signed ITR-V through normal or speed post and click on the ‘Continue’ button.
- Read the instructions carefully before e-filing the online process.
Now under part A: You’ll have to fill in basic personal information such as Name, PAN Number, Aadhar Number, Address, Email ID, and so on.
- Now, fill in all the income and deduction details for income tax computation.
- You will get the details related to tax already paid, tax amount payable, and ITR refund amount under the ’Taxes Paid and Verification’ section.
- Under sections ‘80G’ and ‘80D’, you can also claim tax benefits.
- 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 acknowledgement receipt on your registered email ID.
How to Check ITR Status?
Once you fill the income tax return before the due date, the next step is to check your ITR status. The same can be done in a few simple steps:
- Visit the official website of Income Tax Department e-filing portal homepage.
- Go to the “Income Tax Return (ITR) Status” option.
- Provide acknowledgement number, mobile number and click on ‘continue’.
- A 6-digit OTP will be sent to your registered mobile number. Enter the OTP and submit.
- You can now see your ITR status online.
Tips to Get Maximum ITR Refund
Every taxpayer should be mindful of the income tax return deadline. As a taxpayer, you should also know that apart from the claims in Form 16, there are other ways to make higher refunds. Here are some things that you can do to maximise your ITR refund:
Filing the ITR Timely
Make sure you remember the ITR due date and file the ITR timely to avoid any delays or late fee charges and penalties. As mentioned above, the income tax return deadline or the ITR due date for AY2023-24 is July 31, 2023.
Choosing the Right Tax Regime
With the introduction of the new tax regime you’ll have the leverage to choose between the new and old regime. Depending on your income, the deductions and the exemptions you wish to avail, you’ll have to decide whether the new or the old regime is more suitable to your needs.
Keep in mind that if you do not select one, then by default, you will be directed to the new regime.
Maximising the Exemptions
By identifying the exemptions and deductions that you can claim, you can significantly reduce your tax liability, and get a higher refund. You can save by investing in:
- Public Provident Fund
- National Pension Scheme
- National Saving Certificate
- Life Insurance
- Home Loan Interest
- Medical Insurance
You can also take advantage of exemptions such as Leave Travel Allowance (LTA), House Rent Allowance (HRA) and gratuity etc.
Validating Bank Accounts
Bank account validation on ITR e-portal is essential to get the claimed refund. Without a validated account the application will consider null and void.
Reviewing the ITR
It is crucial to file the return accurately by ensuring that all the relevant documents and proofs are duly submitted. Any error or misinformation can cause a delay in the ITR processing, and may lead to ITR penalties too.
Last Date of Filing ITR
One should be aware of the last date of filing ITR depending on the category they belong to. For instance, the deadline to file ITR is July 31st of the assessment year, applicable for individuals, Hindu Undivided Family (HUF) members and taxpayers who do not need to get account books audited. Missing the income tax return deadline can attract ITR penalties levied by the I-T Department.
Nutshell
In this way, the filing of income tax can be done in a hassle-free manner when you follow the income tax return deadline. As a dutiful citizen, paying taxes is one of your primary responsibilities.
If you wish to reduce your tax liabilities, you can invest your money wisely and make the most of the tax benefits you are eligible for. for instance, under Section 80D of the Income Tax Act, you can claim tax reduction on health insurance premium. If you do not have one already, the right time is now. Among many other reputed health insurance providers, Care Health Insurance is popular for offering comprehensive coverage through multiple plans. These plans are tailor-made as per your insurance requirements. All you need to do is to explore a bit and get the one that best suits your budget and needs.
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.
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