how to file itr for salaried person
Filing income tax returns promptly is an all-important financial exercise for salaried individuals in India. However, the procedure for filing returns remains fenced by several misconceptions and a general lack of information. So today, we shed light on this subject by answering all queries on how to file income tax returns online for salaried employees.
Income Tax Return: An Overview
The Income Tax Act, 1961, mandates Indian taxpayers to furnish details of their income earned and applicable taxes on the same through a form. This form is known as an income tax return or ITR. An assessee, therefore, submits this form to the Income Tax Department of India.
Additionally, the information of income provided in this form pertains to a given financial year, i.e., a year commencing from April 1st and ending on March 31st of the subsequent year.
Furthermore, before we dig into how to file income tax returns for salaried employees, let’s understand who should file them. Individuals who fall into the following categories are liable to file ITR:
- An assessee whose gross income is more than the basic exemption limit before deductions under Sections 80C, 80CCD, 80D, 80TTB, and 80TTB. The table below summarises the basic exemption limit:
Age of the Individual | Amount of Income |
Up to 60 years of age | ₹2,50,000 |
Between 60 years to 80 years of age | ₹3,00,000 |
Above the age of 80 years | ₹5,00,000
|
- An individual earning income from more than one source of income, such as a residential property, capital gains, investments, etc.
- Individuals with investments or earnings from foreign assets
- An assessee with over ₹1 crore of deposits in one or more banks
- An individual who has made a payment of over ₹2,00,000 on foreign travel of a person. (this person may or may not be a family member)
- An assessee who has paid more than ₹1,00,000 as electricity charges in a year
How to File an Income Tax Return online for Salaried Employees?
Now that you are familiar with filing income tax returns, let us elaborate on how to file ITR online for a salaried person. Simply follow these steps:
- Step 1: Navigate to the e-filing portal of the Income Tax Department.
- Step 2: Log in to the portal by submitting your user ID (PAN), password, and a Captcha code. If you are not registered with this portal, you can sign up using your Permanent Account Number (PAN), which will then serve as a user ID.
- Step 3: Under the e-file section, click on ‘Income Tax Return’ from the drop-down menu and select the relevant assessment year. At this point, you need to select the appropriate income tax return (ITR) form and download it. Salaried employees can opt for ITR-1, ITR-2, or ITR-3 (which we shall delve into later in this article).
- Step 4: Select the filing type as ‘Original’ if you are not filing for a revised return.
- Step 5: Choose the submission mode of ‘Prepare and Submit Online’ and click on ‘Continue.’
- Step 6: Now, fill in the relevant ITR form with all the necessary details related to your income, deductions, exemptions, and investment. Then, you are required to add the details of tax payments through TDS, TCS, and advance tax. However, ensure that all data is accurate. Additionally, click on the ‘Save The Draft’ option periodically to avoid losing data due to technical errors.
- Step 7: Compute the tax payable and pay tax. Then, enter challan details in your tax return. (You should skip this step if you do not have any tax liability).
- Step 8: Confirm the details entered in the form. Then, select ‘Submit.’ This is how you can file ITR online for a salaried employee.
At this point, a message flashes on your computer screen, prompting successful e-filing. Subsequently, an acknowledgement form called ITR-V is generated. Now, you must verify your return by way of any of these modes:
- Aadhaar OTP
- Bank account number
- Demat account number
- Registered mobile number
- Net banking
- Bank ATM
- Sending a physical copy of the acknowledgement to the Centralised Processing Centre (CPC) in Bengaluru via post
This is how you can file ITR for a salaried person.
As mentioned earlier, salaried individuals in India can opt for any of the following ITR forms:
- ITR-1 (Sahaj): Salaried employees with a total income of up to ₹50,00,000 must file their income tax returns with ITR-1. Here, the total income includes earnings under the ‘Income from Other Sources’ alongside salaries. However, to file an ITR-1, an assessee should not have more than one house property. Additionally, his/her income from agriculture should not exceed ₹5,000.
- ITR-2: It is applicable for those salaried persons whose total income exceeds ₹50,00,000. Moreover, individuals with more than one house property are eligible to file ITR-2. Additionally, you can file income tax returns with ITR-2 if you generate income from capital gains and/or other sources, but not from profits or gains from business or profession.
- ITR-3: As a salaried employee, you can file an ITR-3 if you receive income from salary, business or profession, house property (one or multiple), capital gains, and other sources.
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