10 key points first time taxpayers should know before filing IT returns

Rate this post

As the deadline to file Income Tax returns (ITR) approaches, first-time taxpayers must know the basics of the process. File your ITR by July 31 of a financial year to avoid penalties. Here are some key lessons that every beginner should know before filing their ITR:

Know your total taxable income

This represents your entire income from all sources, including salary after accounting for any tax-saving deductions.

Understand your tax regime

India has two tax regimes: Old and new.

The new regime, introduced in 2020, features revised tax slabs and concessional rates. However, it has limitations on claiming certain deductions and exemptions. If you don’t choose a regime, the default will be the new tax regime. Understand the pros and cons of each regime to make an informed choice.

Gather all necessary documents  

Before beginning the filing process, collect all relevant financial documents. These typically include:

Form 16 from your employer

Bank statements Investment proofs (for tax-saving investments)

Rent receipts (if claiming HRA)

Loan statements (for home loan interest deduction)

PAN Card

Aadhaar card

Review Form 26AS

Form 26AS provides a summary of income with TDS (Tax Deducted at Source) deductions, which is essential for precise tax filing.

Annual Information Statement (AIS)

Contains details such as interest income, dividends, securities transactions, and foreign remittances, all pre-filled in your ITR form for convenience.

Choosing ITR Forms

Selecting the appropriate ITR form is an important step in filing your taxes accurately.
Claim eligible deductions

Deductions under sections like 80C (up to Rs 1.5 lakh), 80D (health insurance), 80TTA (bank interest) and 80G (donations) can reduce your tax liability. Ensure you claim all the eligible deductions while filing your return.

Don’t miss deadline

Timely filing is crucial to avoid penalties and interest charges. The usual deadline for filing ITR is July 31st for the previous financial year. However, it’s advisable to check the official Income Tax Department website for any extensions or changes in deadlines.

E-Filing is the way to go

The Income Tax Department encourages e-filing of returns through its portal. This method is not only convenient but also reduces the chances of errors. First-time filers can create an account on the portal and follow the step-by-step process to submit their return.

Click here to file ITR yourself





Verify your return

After submitting your ITR, it’s essential to verify it within 120 days. This can be done through various methods, including Aadhaar OTP, net banking, or by sending a signed copy of ITR-V to the Centralised Processing Centre, Bengaluru.

Source link

Visit www.cagurujiclasses.com for practical courses

Pooja Gupta

CA Pooja Gupta (CA, ISA, M.com) having 15 years of experience. Educator and Digital Creator

Disclaimer:- The opinions presented are exclusively those of the author and CA Guruji Classes. The material in this piece is intended purely for informational purposes and for individual, non-commercial consumption. It does not constitute expert guidance or an endorsement by any organization. The author, the organization, and its associates are not liable for any form of loss or harm resulting from the information in this article, nor for any decisions made based on it. Furthermore, no segment of this article or newsletter should be employed for any intention unless granted in written form, and we maintain the legal right to address any unauthorized utilization of our article or newsletter.

CA Pooja Gupta (CA, ISA, M.com) having 15 years of experience. Educator and Digital Creator

Leave a Comment