Income tax return filing 2024-25: Everything You Must Know

In India, Income tax return filing is important. Through ITR, the government takes details of your income, investments, deductions, and taxes during a fiscal year. Your ITR shows how much you contribute to public services and infrastructure. The importance of ITRs has a positive effect on national progress.

An overview of the importance and procedural aspects of ITR filings in India is presented in this article.

What is Income Tax?

The income tax you pay to the government is a portion of your earnings. These funds are used by the government for development. Everyone, family, or business that earns money must pay some income tax. Depending on your income, you will give different amounts. Based on the rules set by the government, you must give a certain amount.

What is ITR (Income Tax Return)?

Taxpayers must file their Income Tax Returns (ITRs) to the tax department. Through ITR, you report the income you earned and corresponding tax obligations.

There are seven distinct tax forms, which are ITR 1, ITR 2, ITR 3, ITR 4, ITR 5, and ITR 6. The deadline for filing an ITR must be adhered to by every taxpayer. Taxpayers’ income sources earned income amounts, and taxpayer categories (individuals, HUFs, corporations, etc.) influence the choice of ITR form.

Am I eligible to file a tax return?

Different scenarios require different ways to file an income tax return. The following are the types of people who should file an income tax return:

Individuals earning over a certain amount must file an income tax return if their gross income exceeds the exemption level before deducting under Sections 80C to 80U.
The IT returns must be filed by entities such as private limited companies, limited liability partnerships, and partnerships regardless of whether the firm is in profit or loss.
An income tax return must be filed by individuals holding positions as Directors of Limited Liability Companies and Partners of Limited Liability Partnerships.
Those who earn dividends from many sources (mutual funds, bonds, stocks, fixed deposits, and interest, among others) must file an income tax return.
Tax Returns for Individuals Receiving Income from Religious Trusts/ Charities: Individuals receiving income from charities or religious trusts and voluntary contributions are also required to file an income tax return.
If you are eligible for tax refunds, file a federal income tax return to claim your rightful refund.
The non-resident Indian community (NRI) and the technology community also fall under the category of individuals who are required to file a tax return based on their income and circumstances.

Income Tax Slabs in India

There are certain circumstances under which Indians are required to file an Income Tax Return (ITR). You qualify for a basic exemption if your gross total income exceeds the corresponding age-specific limit.

Age-Specific Limit	Tax Amount
> 60-Year-Old	Rs 2.5 lakh
60–80-Year-Old	Rs 3.0 lakh
< 80-year-olds	Rs 5.0 lakh

It is mandatory for you to file an ITR regardless of whether your income is below the basic exemption limit:

If you have deposited more than Rs 1 crore in a current bank account (excluding post office current accounts), this is mandatory.
If you have deposited more than Rs 50 lakh into one or more savings bank accounts, you must complete this form.
Mandatory for those who spend more than Rs 2 lakh on foreign travel.
Expenditure on electricity exceeding Rs. 1 lakh
Mandatory for all taxpayers over Rs 25,000 (Rs 50,000 for seniors).
Businesses with annual sales or turnover over Rs 60 lakh
Required for professionals with gross revenue more than Rs. 10 lakhs.

ITR-1	SAHAJ	For individuals earning less than Rs. 50 lakhs per year from salary or pension. A house property may only be owned by one person
ITR-2	Beyond Business	For NRIs, directors of companies, and shareholders of private companies. Own two or more properties or have foreign income. Income exceeds Rs. 50 lakhs, you are eligible for this tax.
ITR-3	Professionals & Proprietorships	Designed for Indian professionals and proprietors
ITR-4	Presumptive Taxation Enrollees	Individual subject to presumptive taxation. Income from business or professional activities should not exceed Rs. 2 crores.
ITR-5	Partnerships, LLPs, & More	Individuals, partnerships, LLPs, and associations must file these forms.
ITR-6	Companies	India-registered companies
ITR-7	Special Entities	A charitable trust, political party, scientific research institution, and college or university may be subject to this.

Why ITR Filing?

The ITR you submit is valid proof of your income. Documentation like this can be invaluable in various situations, from financial transactions to legal issues.
ITRs are often required when seeking loans in the future by financial institutions. When you file an ITR, you demonstrate that you are financially stable and capable of making payments.
ITRs are essential for credit card applications: Banks require you to submit an ITR if you wish to apply for a credit card. The purpose of this practice is to help banks determine whether you are creditworthy and eligible for credit limits.
The ITR is essential to the application for a visa, especially if you are traveling abroad. Often, authorities use ITRs to verify financial standing and ties to home.

E-Filing of Income Tax Return (ITR)

Using online platforms and digital methods, you can electronically file your income tax return with the tax authorities. Through official websites and designated online portals provided by the tax department, individuals and entities can file their tax returns electronically instead of submitting physical documents. It simplifies and speeds up the filing process, improving convenience, efficiency, and environmental friendliness compared with traditional paper-based filing.

Income Tax Return (ITR) Filing: Documents Required

The following documents must be gathered before the taxpayer can begin the process of e-filing the ITR:

Permanent Account Number (PAN)
Form 26AS and other relevant statements
Bank statements
Form 16

How To E-File ITR? A Step-by-Step Guide

(A) Log in to the portal first

Click the ‘Login’ option on the Income Tax e-filing website. The User ID field requires your PAN. Select ‘Continue’. Tick the box next to the security message to verify it. Click ‘Continue’ and enter your password.

(B) Click on ‘File Income Tax Return’

You can file your income tax return by clicking the ‘e-File’ tab and selecting the ‘Income Tax Returns’ option

(C) Pick the right ‘Assessment Year’ ‘

Choose ‘Assessment Year’ and ‘Online’ for filing.

(D) Determine the status of the filing

You can choose either Individual, HUF, or Other as your filing status. By selecting ‘Individual,’ click ‘Continue.’

(E) Decide what type of ITR to file

Depending on your circumstances, determine the appropriate ITR form. ITR forms are available in seven different formats. Using ITR 2 is appropriate if you have capital gains but no income from business or profession, for example. The type of ITR you choose should match your tax situation.

(F) ITR Filing – Reasons

Give a brief explanation of why you are filing your tax return. According to your situation, choose one of the following options:

There is more taxable income than the basic exemption limit
Specific criteria require filing
There are other reasons as well

(G) Review information and add bank account details

If you have previously provided your bank account details, ensure they are accurate and pre-validated.

Fill out the next page with the prefilled information.
Make sure the information is accurate by thoroughly reviewing it.
Ensure your returns are summarized correctly and the details provided are accurate.

(H) ITR E-Verification

It is crucial that you verify your return as the last step. In the absence of verification, you cannot file.

If you choose to send a copy of your ITR-V to CPC, Bengaluru, you may do so by sending a physical copy as well as the Aadhaar OTP, the electronic verification code, or the net banking method.

Returns for previous years’ income tax

Use the ITR U form if you need to file income tax returns from previous years. ITR-U can be employed for a limited time, depending on certain conditions and limitations.

Belated returns: Understanding them

Belated Returns refer to tax returns filed after the original due date. The deadline for filing a Belated Return for the financial year 2022-23 is 31st July, but you can file a Belated Return at any time after this date. Your return can be submitted after the original deadline but before the extended deadline, usually until the 31st of December.

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FAQ

What is the late fee for ITR filings under Section 234F?

As outlined in Section 234F, if you file your income tax returns late, you will be assessed a late filing fee.

ITRs filed after the deadline (31st July 2024) but before the extended deadline (31st December 2024) will be subject to a maximum penalty of Rs 5,000.
Tax relief is available for small taxpayers, however. The maximum penalty for a delay is Rs 1,000 if your income does not exceed Rs 5 lakh.

What is the latest update on the income tax filing option called Pay Later?

You can now complete your tax filing before making any tax payments using the Income Tax e-filing portal’s ‘Pay Later’ option. When you are done filing, you can pay your taxes.