An income tax return is a form that enables a taxpayer to declare his income, expenses, tax deductions, investments, taxes, etc. The Income Tax Act, of 1961 makes it mandatory under various scenarios for a taxpayer to file an income tax return.

An income tax return is a form filed to report the annual income of a taxpayer. There may be various reasons for filing an income tax return even in the absence of income.

A taxpayer may want to file his income tax return for reporting his income for a financial year, carrying forward losses, claiming an income tax refund, claiming tax deductions, etc.

The Income Tax Department provides the facility for electronic filing (e-filing) of an income tax return. Before discussing the steps involved in the e-filing of income tax returns, it is essential for a taxpayer to keep the documents for calculation and reporting data in ITR.

Step 1: Calculation of Income and Tax

The taxpayer will be required to calculate his/her income as per the income tax law provisions applicable to him/her.

The calculation should take into account income from all sources such as salary, freelancing and interest income. The taxpayer can claim the deductions such as tax-saving investments under section 80C and so on.

Also, a taxpayer should take into account credit for TDS, TCS or any advance tax paid by them.

Step 2: Tax Deducted at Source (TDS) Certificates and Form 26AS

The taxpayer should summarise his TDS amount from the TDS certificates received by him for all the 4 quarters of the financial year. Form 26AS helps the taxpayer with the summary of the TDS and tax paid during the financial year.

Step 3: Choose the right Income Tax Form

The taxpayer has to ascertain the income tax form/ITR Form applicable for filing his income tax return. After ascertaining the income tax form, the taxpayer can proceed with the filing of the income tax return. There are 2 modes available for filing–online and offline. The online mode from the login of the taxpayer is available only for ITR 1 and ITR 4; it is not available for forms of other categories of individual taxpayers. The offline mode (generating XML and uploading) is available for all types of income tax forms.

Step 4: Download ITR utility from Income Tax Portal

Visit the site www.incometax.gov.in and click on ‘Downloads’ from the top menu bar.

Choose the assessment year and download the offline utility software, i.e. Microsoft Excel or Java, or JSON utility based on your preference. The excel and java utility are discontinued by the income tax department from AY 2020-21

Step 5: Fill in your details in the Downloaded File

Upon downloading the offline utility, fill in the relevant details of your income, and check the tax payable or the refund receivable as per the calculations of the utility. The details of income tax challan can be filled in the downloaded form.

Step 6: Validate the Information Entered

You can see a few buttons on the right-hand side of the downloaded form. Click on the ‘Validate’ button to ensure all the required information is filled.

Step 7: Convert the file to XML Format

Upon successfully validating, click on the ‘Generate XML’ button on the right-hand side of the file to convert the file into XML file format.

Step 8: Upload the XML file on the Income Tax Portal

Now, log in to the income tax e-filing portal and click on the ‘e-File’ tab to select the ‘Income Tax Return’ option.

Provide the necessary details such as PAN, assessment year, ITR form number, and submission mode. Remember to choose the option ‘Upload XML’ from the drop down corresponding to the field name ‘Submission Mode’ as given in the image below.

Now, attach the XML file from your computer and click on the ‘Submit’ button.