It is mandatory to file Income Tax Returns for individuals with an income over Rs. 2.5 lakh (in case of those below 60 years of age) or Rs 3 lakh (in case of people over 60 years old but less than 80 years old) or Rs 5 lakh (for those over 80 years old). These exemption limits keep changing from time to time, depending on the government policies and notifications.
Also, the process for filing the returns is quite simple. One just needs to be aware of the different kinds of ITR Forms, their applicability and some commonly used terms.
Form ITR-1 or “Sahaj” (derived from the Hindi word meaning “easy”) is the most commonly used form for filing Income Tax Returns. It is primarily used by salaried individuals. However, there are certain categories of salaried individuals who need to submit their returns through other forms like ITR or ITR-2A.
Taxpayers Eligible to use Form ITR-1
Form ITR-1 can be used by individuals who fall in one of the following categories :
- Any salary or pension earned by an individual from his/her employer and taxable under the category “Income from Salary”
- Income from house property
- Income from other sources like interest income, dividends earned, etc.
If the income of the taxpayer has been clubbed with the income of a minor or a spouse, the additional income should also adhere to the previously mentioned clauses, for the taxpayer to use Form ITR-1
Taxpayers not eligible to use Form ITR-1
- Income arising from lottery or winnings from horse races or legal gambling
- Income from multiple house properties. Also, any loss under “Income from House Property” which has been carried forward from the previous financial year
- Income from capital gains that are taxable. This includes both long-term as well as short-term capital gains
- Agricultural income of more than Rs. 5,000
- Income from professional fees or income earned through business
- Loss under the head “Other Sources”
- Individuals applying for relief under DTAA from double taxation or foreign tax that has been paid as per provisions of Section 90, Section 90A or Section 91.
- Any resident individual having an asset not located within the country or one who acts as a signing authority for accounts located out of the country. The term asset, for this purpose, includes financial interest, such as shares or bonds, in any entity.
How to download Form ITR-1
For downloading Form ITR-1, a taxpayer needs to follow the below mentioned steps:
Step 1: Visit the official website of Income Tax https://www.incometaxindiaefiling.gov.in/home
Step 2: Click “Offline Utilities” under Download section
Step 3: Click “Income Tax Return Preparation Utilities”
Step 4: Choose your Assessment Year
Step 5: Click “Excel Utility” for filling the details by hand under ITR 1 column and download the file
Step 6: Extract the downloaded file and fill in the details
Due dates for filing Income Tax Return for FY 2017-18
|Individuals||August 31 2018|
|Businesses (whose accounts need to be audited)||September 30 2018|
|Businesses (required to furnish report under Sec 92E)||November 30 2018|
Last dates for filing Form ITR-1
Taxpayers need to submit the duly completed Form ITR-1 by 31st July of the assessment year to file taxes for the previous year. For example, if the income was earned anytime between April 1, 2017 and March 31, 2018, the assessment year for the same would be 2018-19. In this case, the ITR-1 Form needs to be submitted on or before 31st July, 2018.
Penalty on late filing of ITR
In case the taxpayer fails to complete the tax return formality within these timelines, he/she can file a “Belated Return” any time before 31st March, 2019. However, late filing attracts penalty. From April 1, 2018, the Government of India introduced the change of imposing fine for late filing of ITR. On filing the ITR after the due date, a maximum penalty of Rs 10,000 will be imposed. If the return is filed after the due date but before December 31, one will pay a fine of Rs 5,000. In case the return is filed after December 31, the amount would be Rs 10,000. However, in case the income is not over Rs 5 lakh, the maximum amount to be paid would be Rs 1,000.
Structure of ITR-1 Form
Form ITR-1 is made up of the following sections :
- Part A: Personal and identifiable details of the taxpayer, such as name, PAN number and address
- Part B: Total income for the financial year
- Part C: Details of all deductions and total taxable income
- Part D: Details of tax calculations and status
- Schedule IT: Information regarding payments made towards self-assessed tax and advance tax paid.
- Schedule TDS1: Information regarding TDS deducted from salary and mentioned in Form 16 provided by the employer
- Schedule TDS2: Information regarding TDS deducted from “Income other than salary” and as mentioned in Form 16A provided by the deductor.
- Supplementary schedules of tax deducted at source and Income Tax which are to be used after exhausting the line items in the main portion of the form.
Ways of submitting ITR-1 Form
There are two modes for submitting the income tax returns: Offline and Online:
- By furnishing ITR in the physical or paper form
- By furnishing ITR in a bar coded return form
- Filing return electronically with a digital signature
- By submitting the data in the return form electronically and subsequent to that submitting the signed copy of the Return Form ITR-V
Post financial year 2013-14, taxpayers with annual income above Rs. 5 lakh are required to furnish their income tax returns in an electronic format i.e. the online mode as mentioned above.
Procedure for Completing Form ITR-1 Offline
- An assessee whose annual income is less than Rs 5 lakh can file the ITR offline.
- He/she would need to either collect the form from the Income Tax Office or download the same from the income tax website incometaxindia.gov.in
- It needs to be submitted to the Assessing Officer concerned or to designated helpdesks known as “Aaykar Sampark Kendra”.
- Along with the ITR form, he/she also needs to fill in the acknowledgement form, which contains the summary of the ITR.
- A stamped copy of the acknowledgement form is given back to the assessee after the submission.
Procedure for Completing Form ITR-1 Online
- Taxpayers need to create an account on the website of the Income Tax Department.
- It is a one-time activity and the login details can be used for subsequent years.
- In addition to the regular excel utility, the I-T Department has also released a new Java-based utility with many new features, including direct upload, smoother interface, etc.
- Taxpayers can choose to submit the details by either using excel/java utility or without it.
Using excel/java Utility
- Login to the website (https://incometaxindiaefiling.gov.in/) and select ITR-1 Form.
- Download the ITR Java or excel utility and provide all the required details. It is important to verify the details as mentioned in Form 16 or Form 16A or Form 16B, as applicable, and Form 26AS.
- Once completed and verified, the taxpayer can login to the Income Tax website and directly upload the return through the Java Utility. Else, the taxpayer can create an Xml version of the return form and upload the same on the website.
- Post successful submission and upload, an Acknowledgement message gets displayed on the screen. The ITR-V also gets generated which is to be e-mailed by the taxpayer to the I-T Department’s email mentioned on the form.
Not using excel/java utility
Filing of ITR can be done online even without downloading the Excel/Java Utility software;
- Log in to the account on website https://incometaxindiaefiling.gov.in/
- Go to “E-File – Income Tax Return- Prepare and submit online”
- The taxpayer would need to furnish all the required details
If the taxpayer had not used “Digital Signature” while filing the return, then the ITR-V copy sent on the registered mail ID needs to be signed by the taxpayer and sent back to the I-T department within a period of 120 days after filing the return. Since 2014-15 FY, the government has also provided an option to link the ITR Form with the taxpayers’ Aadhaar card. Once linked, the taxpayer is not obligated to send across the signed copy of the ITR-V Form to the officials. As of the assessment year 2017-2018, it is mandatory to link Aadhaar with PAN.
Advantages of Online Mode
Apart from the ease of filling up the form at a convenient time and location, following are some of the other benefits:
• This happens on the basis of the data entered by the taxpayer in previous year’s ITR or as stored against the PAN in the I-T Department.
• System in the software prevents the form from getting submitted and prompts taxpayer about missing information in the mandatory fields.
• Calculates tax payable or refunds, basis the income and deductions filled in ITR, reducing the chance of incorrect calculations.
For taxpayers who choose to submit their returns via the electronic or online mode, the acknowledgement copy is mailed by the I-T Department on their registered mail ID. They can also download the same from the Income Tax website. Taxpayers who use the physical form to submit their returns, receive their acknowledgement copy from the I-T Department after the submission of the form.
Supporting documents needed for Form ITR-1
A smart taxpayer should keep the following documents handy while filling the ITR-1 Form. This will not only simplify the process but also expedite it.
- Form 16:In case a taxpayer was employed with multiple employers in the previous year, he/she will need to keep all the Form 16 that he/she would have received.
- Form 16A:If the taxpayer has received any interest income or pension from banks or other institutors, they would have issued with the tax certificate or Form 16A. This will prove as a helpful document while filing the tax returns.
- Form 26AS:This form can be downloaded from the TRACES website. It contains comprehensive information regarding the amount of tax deducted and deposited on the taxpayer’s behalf by all the deductors in a particular financial year. One should verify that the TDS mentioned in Form 16/Form 16 A matches with the amount of TDS reflected in Part A of Form 26AS.
- Bank statements or passbooks:These are needed to check and provide complete details of the interest earned on Savings Account and time deposits like Fixed Deposits, Recurring Deposits, etc. The total amount of interest should get reflected under the category “Income from Other Sources”, irrespective of the TDS.
- Supporting documents for investments or exemptions:If there are any investments that have been made post submission of proofs to the employer, but before the end of the financial year or if the taxpayer was unable to submit proof of certain exemptions or deductions (such as HRA allowance or Section 80C or 80D deductions) on time.
- PAN card
Common terms used in Form ITR-1:
- Advance Tax: Tax Deducted at Source (TDS) is a form of advance tax for individuals who have received income from salary. However, for other sources of income, such as interest earned on deposits (fixed, recurring as well savings) from banks, bonds, earnings as a landlord, capital gains or Interest on bonds, etc. a taxpayer is required to file advance tax in installments, if such income is above Rs. 10,000 per year. These payments need to be made on a quarterly basis i.e. September, December and March.
- Self-Assessment Tax Payments: Simply put, this is the gap between the tax payable and the actual tax paid. The amount needs to be calculated before filing the return. A taxpayer can fill in all the details in the ITR Form along with the details of advance tax paid, if any. This will help him/her identify any balance tax payable from his/her end.
- Notice Number: In case a taxpayer has received a notice or a demand from the I-T Department and he/she is filing the return as a response to such notice, then he/she is required to fill in these details in the form.
- Revised Return: In case a taxpayer realizes that the submitted ITR Form for the last financial year had any errors or omissions, he/she needs to re-file the same. This is referred to as a revised return. The window for this is open till the end of the next financial year. For example, for the FY 2015-16, a taxpayer can file the revised return till end of next the financial year 2016-2017 i.e. March 2017.
- Annexure Less Return: ITR-1 Form is referred to an Annexure-less return form. This is so because the taxpayer does not need to attach any supporting documents, such as Form 16, Form 16A, Form 16B or Form 26AS along with this form.