Asktrix

Guide to Income Tax Return (ITR) Filing

An Income Tax Return (ITR) is a form used to file information about your income and taxes to the Income Tax Department of India. It is mandatory for individuals and entities whose income exceeds the basic exemption limit to file their ITR annually.

Governing Act and Rules

Income Tax Return filing is governed by the following acts and rules:

  • Income Tax Act, 1961: Primary legislation governing income tax in India
  • Income Tax Rules, 1962: Detailed procedures for return filing and compliance
  • Finance Act: Annual amendments to tax rates and provisions

Types of ITR Forms

ITR Form Applicable For Description
ITR-1 (Sahaj) Individuals For individuals with income up to ₹50 lakh from salary, house property, other sources
ITR-2 Individuals and HUFs For individuals and HUFs not having business or professional income
ITR-3 Individuals and HUFs For individuals and HUFs having income from business or profession
ITR-4 (Sugam) Individuals, HUFs, and Firms For individuals, HUFs, and Firms under presumptive taxation scheme
ITR-5 Firms, LLPs, AOPs, BOIs For firms, LLPs, AOPs, BOIs, and other entities
ITR-6 Companies For companies other than those claiming exemption under section 11
ITR-7 Persons and Companies For persons including companies required to furnish return under sections 139(4A), 139(4B), 139(4C), 139(4D), 139(4E), or 139(4F)

Who Must File an Income Tax Return?

  • Individuals: Total income exceeds ₹2.5 lakh (₹3 lakh for senior citizens, ₹5 lakh for super senior citizens)
  • Companies: All companies regardless of income or loss
  • Capital Gains: Individuals with capital gains exceeding ₹2.5 lakh
  • Foreign Assets: Individuals with foreign assets or income
  • High-Value Transactions: Individuals with high-value transactions (deposits, investments, etc.)
  • Refund Claims: Individuals claiming tax refunds

Who is Exempt from Filing ITR?

  • Low Income: Individuals with total income below ₹2.5 lakh (₹3 lakh for senior citizens)
  • Senior Citizens: Individuals above 60 years with income below ₹3 lakh
  • Super Senior Citizens: Individuals above 80 years with income below ₹5 lakh
  • Agricultural Income: Individuals with only agricultural income below exemption limit

Step by Step Process for Income Tax Return Filing

Our streamlined process ensures quick and hassle-free ITR filing:

1

Gather Required Documents

Collect all necessary documents including Form 16, bank statements, investment proofs, and other income-related documents.

2

Log into the Income Tax Portal

Access the official Income Tax e-filing portal (www.incometax.gov.in) using your PAN and password. Ensure you have valid credentials.

3

Select the Appropriate ITR Form

Choose the correct ITR form based on your income sources and taxpayer category. Common forms include ITR-1, ITR-2, ITR-3, and ITR-4.

4

Fill Out the ITR Form

Enter all required information including personal details, income from various sources, deductions, and tax calculations. Ensure accuracy in all entries.

5

Compute and Pay Tax Liability (If Any)

Calculate your total tax liability and pay any outstanding tax using available payment methods. Ensure sufficient balance in your bank account.

6

Verify and Submit

Review all information one final time, generate the return summary, and submit the return. Download the acknowledgment for your records.

Benefits of Timely ITR Filing

  • Avoid Penalties: Timely filing prevents late filing penalties and interest charges
  • Carry Forward Losses: Allows carrying forward of losses to future years
  • Loan Processing: ITR acknowledgment is required for loan applications
  • Visa Applications: Required for visa applications to many countries
  • Tax Refunds: Enables claiming of tax refunds if applicable
  • Compliance Record: Maintains good compliance record with tax authorities

Income Tax Exemptions and Deductions

Popular deduction options to reduce your tax liability:

  • Section 80C: Up to ₹1.5 lakh for investments in PPF, ELSS, NSC, etc.
  • Section 80D: Up to ₹25,000 for health insurance premiums
  • Section 80G: Donations to charitable organizations
  • Section 80TTA: Up to ₹10,000 interest on savings account
  • Section 24: Interest on home loan up to ₹2 lakh

Example Tax Savings:

If you invest ₹1.5 lakh under Section 80C, you can save up to ₹46,800 in taxes (assuming 30% tax bracket).

Due Dates for Filing ITR

  • Individuals: July 31st of the assessment year
  • Companies: October 31st of the assessment year
  • Audit Cases: October 31st of the assessment year
  • Transfer Pricing Cases: November 30th of the assessment year

Penalties for Non-Compliance

  • Late Filing: ₹5,000 penalty for filing after due date (₹1,000 if income is below ₹5 lakh)
  • Non-Filing: Up to ₹10,000 penalty for not filing ITR
  • Incorrect Information: Penalty of 50% to 200% of tax evaded
  • Interest: 1% per month on outstanding tax amount

Asktrix's Expert ITR Filing Services

  • Accuracy: Expert review ensures error-free filing
  • Compliance: Full compliance with latest tax laws
  • Timely Submission: On-time filing to avoid penalties
  • Maximum Deductions: Optimize your tax savings
  • Document Management: Secure handling of all documents
  • Expert Support: Professional guidance throughout the process
FAQ

Frequently Asked Questions

Find answers to common questions about ITR filing, forms, eligibility, process, benefits, and compliance.

Who needs to file an ITR?

Individuals with total income exceeding ₹2.5 lakh (₹3 lakh for senior citizens, ₹5 lakh for super senior citizens) must file ITR. Companies must file regardless of income.

Which ITR form is applicable to salaried individuals?

Salaried individuals with income up to ₹50 lakh and no business income should use ITR-1 (Sahaj). Those with capital gains or foreign income should use ITR-2.

What is the penalty for late ITR filing?

Late filing attracts a penalty of ₹5,000 (₹1,000 if income is below ₹5 lakh). Additional interest at 1% per month is charged on outstanding tax.

Can I revise my ITR after submission?

Yes, you can revise your ITR within the assessment year or before completion of assessment, whichever is earlier, using the same ITR form.

What are Sections 80C and 80D?

Section 80C allows deduction up to ₹1.5 lakh for investments in PPF, ELSS, NSC, etc. Section 80D allows deduction up to ₹25,000 for health insurance premiums.

How does Asktrix assist in ITR filing?

Asktrix provides complete ITR filing services including form selection, data entry, tax calculation, deduction optimization, and timely submission with expert guidance.

Ensuring smooth ITR filing with Asktrix provides not only compliance but also maximum tax savings and peace of mind. Our comprehensive approach ensures your tax returns are filed accurately and on time.

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