The countdown for filing your income tax returns (ITR) has begun. The process is as painful as it is necessary. In fact, the term ‘return’ is actually a misnomer. An income tax return is really just a form where you fill in information about your income and tax liability to the income tax department. There are various income tax return forms, beginning with ITR1 and ending at ITR7. But we only need to take a look at ITR1, which is what salaried individuals use.

You are obliged to file your income tax returns under the Income Tax Act 1961 and the Income Tax Rules, 1962, with the government (the Income Tax Department), at the end of every financial year. Citizens who do not file their income tax returns on the pretext that their income is below the tax bracket are in fact obliged by law to file their tax returns every year.

In fact, if you have a credit card, or have travelled abroad, or own a house or a vehicle, you have to file your tax returns. The process of filing your income tax returns is simple. It’s online and you can file your returns yourself without hiring tax consultants. Here’s a basic guide to income tax and filing your income tax returns online.

How do I know if I have to file my income tax returns?
It’s simple. Everybody has to file their income tax returns. It’s an obligation under the Income Tax Act. But if you are an individual, as opposed to a corporate entity, with an income of more than?2.5 lakh per annum, you have all the more reason to file your returns since your income is taxable. If your office has deducted tax on your salary (tax deducted at source or TDS), you have to file your income tax return since the government already has information on your income.

You cannot suddenly stop filing your returns, irrespective of whether your income for the current year falls under the taxable bracket. If you skip a year, you may get an income tax notice, which you don’t want.

Even if you don’t fall in the tax bracket (your income is less than?2.5 lakh per annum), filing your income tax returns helps when you apply for a bank loan or even a visa.

Do I have to file my income tax returns online or can I do it offline?
You can do either, but you would rather choose the easier online or e-filing option. So, here’s the rule. You are allowed to file offline returns only if you are above 80 years of age or if your income is less than?5 lakh. The process of claiming a tax refund is tedious and it takes far more time to receive the refund credit if you’ve filed your returns offline. It’s therefore always better and easier to file your returns online since the possibility of corruption is zero.

How do I file my income tax returns online?
Click on the income-tax e-filing portal and register yourself filing in details such as Permanent Account Number (PAN), password and date of birth. Your Aadhaar number has to be mandatorily linked to your PAN number which you can do here. Since your employer has already deducted taxes at source (TDS), check your tax credit statement (Form 26AS) before you go on to do the following.

Compute your income and taxes.
Download and fill in the appropriate excel utility (it’s an excel sheet for your income tax returns) of the applicable income tax return form and fill in the excel utility sheet and generate an xml file.
Upload this file on the e-filing tax portal.

That done, you will get an acknowledgment of the tax return filed (Form ITR-Verification) from the portal. You have to then validate the ITR-V acknowledgment through Aadhaar, or a digital signature to complete the filing process.

Remember that the e-portal does not allow uploading of any documents, so retain the relevant documents (investment proofs) in support of your income, exemption claims etc, should there ever be a scrutiny from the tax department.

What is Form 26AS?

Form 26AS tells you (and the government, so you can’t hide your income) at a single glance your tax statement for the year. It shows details of your income on which taxes have been deducted and have been paid on your behalf by your employer (TDS) or say a bank (income on fixed deposits) to the government. You can access your 26AS from the income-tax website using your PAN.

Which income-tax return form should I use?

Broadly, there are four ITR forms for individuals, but for a salaried person, you need ITR 1 (Sahaj). This form is for Individuals who have salaried income, one house property, other sources of income like interest on investments, which add up to not more than ?50 lakh per annum.

So, what is Form 16, then?

The income tax Form 16 is a certificate from your employer. The form certifies that tax has been deducted at source by your employer. Your employer has to mandatorily give you a Form 16 if tax has been deducted. Form 16 is normally given to the employee on or before May 31, immediately after the financial year for which you are filing your returns. So for financial 2017-2018, you should get your Form 16 by May 31, 2018.

You will need Form 16 when you e-file your tax returns since it contains much of the information you need to prepare your income tax returns. Form 16 has two parts, ie, A & B, and has information on the tax your employer has already deducted through the year, a breakup of your salary, deductions that have been allowed under the income tax act etc.

How do I claim my income tax refund?

That’s the best part of filing your taxes – money from the government — into your bank account. But a refund is not natural progression when you file your tax return. You can claim a tax refund only if you have paid excess tax to the government or tax over and above your actual tax liability.

So, why would you pay excess tax?

Well, that happens when your approximation of advance tax paid, or self-assessment tax paid or the tax deducted at source, is higher than your tax liability. The claim for refund has to correspond to the year in which you have filed your tax returns.

Once you have filed your returns online, the system will calculate the tax refund due based on the details you have submitted. The refund amount that appears is the refund that you will be claiming from the income tax department, but may not be accepted and therefore paid by the income tax department to you. The actual refund will be decided when your return is processed. But more often than not, you get what you claim.