ITR Filing 2019: If you haven’t filed your tax return yet, remember that you must file it within the due date of 31 August 2019 to avoid penal consequences.
Income Tax Return 2019: The income tax return (ITR) filing deadline is just around the corner. If you haven’t filed your tax return yet, remember that you must file it within the due date of 31 August 2019 to avoid penal consequences.
The first step to filing your ITR is choosing the right ITR Form. If your income is from salary (up to Rs 50 lakh per annum), you own one house property, and have interest income, you must file returns in ITR-1 Form. If you have received income from capital gains along with salaried income, you must choose ITR-2. This task has been made easy by online ITR filing platforms that automatically choose the form relevant to your income and help overcome this crucial aspect of filing tax returns.
The next step is collecting information that a salaried taxpayer must report. The most important details you must provide are given below:
# Salary Breakup: You must provide a detailed salary breakup in the ITR form such as gross salary, allowances, and deductions u/s 16. You can find these details in Part B of your Form 16.
# Type of House Property: You are required to enter the details under this section only if you own a house property and have let it out on rent. You must fill in the gross rent received during the year, the tax paid to the local authorities, interest paid on house loan taken to purchase the property, and the arrears in rent received during the year if any.
# Interest Income: If one of your income sources is the interest paid by banks/financial institutions on your savings account/fixed deposits, you must provide the details of the interest you have earned and the tax deducted on this income in the form. Check if the bank has deducted taxes from your income by looking it up in your Form 26AS. The tax must be deducted only if the interest you earn exceeds Rs.10,000 per annum in FY 2018-19. However, note that savings account interest and interest income from FDs must both be reported in your ITR.
Watch: ITR 2019: How salaried individuals can file ITR with LTCG details?
# Deductions: You must specify the deductions you have availed under various sections such as Section 80C, 80CCC, 80CCD, 80D, 80E, and others. A deduction of up to Rs 1.5 lakh is available under Section 80C where you can spend on the life insurance premium, provident funds, children’s tuition fees, and equity savings schemes. Similarly, under Section 80D, you can claim the expenditure made on preventive health checkups, and health insurance premiums. Rent paid, donations given to charities and political parties under section 80G, interest paid on loan taken for residential house property purchase, and interest paid on loan for higher education Section 80EE can also be claimed as deduction here. If you had disclosed these to your employer, you can look it up from your Form 16. If you made the related investments but could not inform your employer, you can still claim these deductions in your ITR if the related expenses/ investments were made by 31st March 2019.
# Tax Deducted at Source (TDS): Cross verify the details of the tax deducted from your salary, the amount of salary credited to you, TAN of your employer, and so on appearing in your Form 26AS with TDS in your income tax returns.
# Capital Gains: If you have sold any shares, debentures or mutual fund units during the financial year or transferred any property, you have to give a detailed computation of the capital gains earned during the year in the ITR form.
Take care to understand the limits under each deduction provision before entering the details in the form. If your expenditure exceeds the limit, you will not receive any deduction for the difference amount. Make sure to keep all the necessary documents such as Form 16, payslips, updated bank passbook, house property loan documents, and documents related to capital gains with you while filing returns to quote the exact amount. If you have multiple Form 16s due to job change, you report the salary earned from both the employers in your ITR. Don’t miss filing your return before the due date.
(The author is Founder & CEO, ClearTax)