Before getting into the steps of filing income tax return for a salaried individual, we want you to know the due dates of filing your tax return and late fee to be paid if its missed.
Income Tax Return filing due date for a salaried person is 31st July of the assessment year relevant to the previous year for which Income Tax Return is to be filed. For the financial year 2021-22, due date of filing Income Tax Return is 31st July 2022.
If as an individual your accounts are required to be audited under section 44AB of Income Tax Act, 1961, then last date of filing for the financial year 2021-22 is 31st October 2022. Section 44AB tax audit is required for those assessee who has business income and satisfied certain conditions mentioned in income tax act. If you do not have business income, then section 44AB tax audit is not required.
If these due dates of filing are further extended by CBDT, then that specified date will be treated as the actual due date of filing Income Tax Return instead of 31st July/31st October.
If you file your Income Tax Return after the due date of filing, then you may have to pay late filing fee of up to Rs 5,000 based on your taxable income.
Below in this article, we will discuss the steps for a salaried individual involved in filing income tax return online in order to avoid late filing fee.
Collect required documents to file tax return
The first step in filing income tax return online is to collect all relevant documents in order to assess your tax liability and taxable income.
Apart from salary, you may have some other income such as interest from bank deposits, rent from house property and capital gain. Collect all the information required to calculate such income after the end of the financial year.
Here is a list of few documents that will help you in finding your income and TDS amount deducted;
- Form 16 – to be collected from employer to know how much tax deducted (TDS) on salary income
- Form 16A – to be collected from deductor in case tax has been deducted (TDS) on income other than salary. For example, in the case of interest from bank deposits form 16A has to be issued by the bank to you.
- Bank statements to calculate interest on deposits
- Deduction and House Rent Allowance proof in case not submitted to the employer
- Rent from house property in case not submitted to the employer
- Salary slips and form 12B for the whole year to recalculate your tax liability
- Aadhaar and PAN card
Document requirements may change based on your income and other benefits you claim in your Income Tax Return. Therefore, before filing your income tax return make sure that you are ready with all the correct information and documents.
You can collect all the above documents in the month of April, May and June. However form 16 and 16A can only be collected in the month of June.
Cross check form 26AS online
Form 26AS is an online tax credit statement to be downloaded from Income Tax website. Form 26AS will let you know how much tax amount has been deducted (TDS) from your income and deposited against your permanent account number (PAN) for the whole financial year.
After getting form 16, salary slips and form 16A, you need to cross check details with form 26AS to confirm that all the taxes deducted and deposited are reflecting in form 26AS. Most probably form 16, 16A and 26AS will tally as all these forms are prepared by and downloaded from traces portal.
However, in case it’s not tally or any excess tax has been deposited for which you are not eligible or some other deductor has deposited tax (which is not yours) against your PAN, then take up this matter with the deductor and do not take tax credit for it to your Income Tax Return.
Please note, if any tax has been paid by you or someone else has deducted and deposited against your PAN, then it will take 2-3 working days from the date of payment to get it reflected in form 26AS.
Now you know how much tax has been deducted and deposited for your PAN. It’s time to calculate your total taxable income and final tax liability.
Compute total taxable income
As per the provisions of section 14 of the Income Tax Act, 1961 every assessee is required to segregate income under five different heads to calculate tax liability.
As per section 14, for the purpose of tax calculation, incomes are to be classified under the following 5 different heads:
- Income from salaries,
- Income from House property,
- Income from Profits and gains of business and profession,
- Income from Capital gains, and
- Income from Other sources.
Please note, in your Income tax return you need to give head wise bifurcation of income. You need to keep it ready before filing tax return. Therefore, head wise classification is the first and foremost thing that you should do to calculate taxable income and tax liability.
If assessee is liable for clubbing, set off and carry forward of income or losses, then income under the above heads has to be computed after applying these provisions.
Based on eligibility, an individual can claim deduction under Chapter VI-A (i.e. section 80C to 80U) from the gross total income in order to find out taxable or total income.
Compute final tax liability
Based on the total taxable income, you need to calculate your tax liability by applying tax rates for the financial year as per the income slabs. From the actual tax liability, you need to deduct followings:
- Tax that has been deducted out of your salary, interest from bank deposits and all other incomes. You can get these details from form 16, 16A and 26AS.
- Advance tax.
- Tax Rebate if any applicable to you u/s 87A.
Balance amount left out if any will have to be paid as self assessment tax after adding surcharge and interest payable under section 234A, 234B and 234C by using challan ITNS 280.
File income tax return
After paying balance taxes if any, you can start the process of filing Income Tax Return. In case the tax deducted (TDS) from your income is more than the actual tax liability, then you can claim a refund for the excess amount deducted in your Income Tax Return.
Government has issued seven Income Tax Return forms for financial year 2021-22 which has to be considered for filing based on assessee’s source of income. Every year new forms are introduced for filing. To file your income tax return, you need to choose the correct Income Tax Return form. If you select the wrong form, the return will be considered as defective.
After uploading your annual tax return, you need to e-verify it. You have 5-6 different ways to e-verify your tax return. In case you have not e-verified your tax return, you will be required to send duly signed copy of the acknowledgement to “CPC Post Box No:1, Electronic city post office, Bangalore-560100, Karnataka, India”.
If you do not verify you tax return within 120 days of uploading, it will be treated as invalid, it means deemed as if not filed the tax return.
In case you are not aware of tax provisions or do not know the process, then we request you to read our articles on income tax to learn more and take the help of a tax practitioner to file your tax return.