ITR FILING December 28, 2017

PROJECT

Income Tax Returns(ITR) E-Filing

An Overview of the Process
Of e-Filing of Returns

A Project Report submitted in partial fulfillment of the requirement for

ICAI Course on Information Technology (ICITSS)

SUBMITTED BY
VYANKATESH GOTALKAR

The ICAI Branch Latur

Latur-413512

AUTHOR – VYANKATESH GOTALKAR

1
ITR FILING December 28, 2017

INDEX

Sr. No. Particulars Pg. No.

1. INTRODUCTION
3

2. BASIC INFORMATION ABOUT TAX 4

3. TAXABLE HEAD OF INCOME TAX 14

DEDUCTIONS 21
4.

5. INCOME TAX E-FILING 24

6. TYPES OF E-FILING 26

7. PROCESS OF E-FILING 29

8. WHO CAN USE WHICH FORM 33

9. SUMMARY & CONCLUSION 38

10. BIBLOGRPHY 39

AUTHOR – VYANKATESH GOTALKAR

2
ITR FILING December 28, 2017

INTRODUCTION

Income Tax Return is the form in which an assesses files information about
his Income and tax thereon to Income Tax Department. Various forms are
ITR 1, ITR 2, ITR 3, ITR 4, ITR 5, ITR 6 and ITR 7. When you file a
belated return, you are not allowed to carry forward certain losses.

The Income Tax Act, 1961, and the Income Tax Rules, 1962, obligates
citizens to file returns with the Income Tax Department at the end of every
financial year. These returns should be filed before the specified due date.
Every Income Tax Return Form is applicable to a certain section of the
Assesses. Only those Forms which are filed by the eligible Assesses are
processed by the Income Tax Department of India. It is therefore imperative
to know which particular form is appropriate in each case. Income Tax
Return Forms vary depending on the criteria of the source of income of the
Assessee and the category of the Assessee.

BASIC INFORMATION ABOUT TAX

 Taxes in India are of two types, Direct Tax and Indirect Tax.
AUTHOR – VYANKATESH GOTALKAR

3
ITR FILING December 28, 2017

 Direct Tax, like income tax, wealth tax, etc. are those whose burden
falls directly on the taxpayer.
 The burden of indirect taxes, like service tax, VAT, etc. can be passed
on to a third party.

Income Tax is all income other than agricultural income levied and collected
by the central government and shared with the states.

According to Income Tax Act 1961, every person, who is an assessee and
whose total income exceeds the maximum exemption limit, shall be
chargeable to the income tax at the rate or rates prescribed in the finance act.
Such income tax shall be paid on the total income of the previous year in the
relevant assessment year.

The total income of an individual is determined on the basis of his

residential status in India.

INCOME TAX RETURN

• Income Tax Return" is a term which is often used when we talk about
income tax. It is a way by which we pay this tax. When total annual
income of a person, including all sources, is more than maximum
unchangeable limitation ( At present it is Rs. 2,50,000/-) then that
person is liable to pay income tax.
• According to Income Tax Act 1961, every person, who is an assesses
and whose total income exceeds the maximum exemption limit, shall
be chargeable to the income tax at the rate or rates prescribed in the
finance act.

Residence Rules

An individual is treated as resident in a year if present in India

I. for 182 days during the year or

II. for 60 days during the year and 365 days during the preceding four
years. Individuals fulfilling neither of these conditions are
AUTHOR – VYANKATESH GOTALKAR

4
ITR FILING December 28, 2017

nonresidents. (The rules are slightly more liberal for Indian citizens
residing abroad or leaving India for employment abroad.)

A resident who was not present in India for 730 days during the preceding
seven years or who was nonresident in nine out of ten preceding yeas I
treated as not ordinarily resident. In effect, a newcomer to India remains not
ordinarily resident.

For tax purposes, an individual may be resident, nonresident or not

ordinarily resident.

Non-Residents and Non-Resident Indians

Residents are on worldwide income. Nonresidents are taxed only on income

that is received in India or arises or is deemed to arise in India. A person not
ordinarily resident is taxed like a nonresident but is also liable to tax on
income accruing abroad if it is from a business controlled in or a profession
set up in India.

Capital gains on transfer of assets acquired in foreign exchange is not

taxable in certain cases.

Non-resident Indians are not required to file a tax return if their income
consists of only interest and dividends, provided taxes due on such income
are deducted at source.

It is possible for non-resident Indians to avail of these special provisions

even after becoming residents by following certain procedures laid down by
the Income Tax act.

Taxability of individuals is summarized in the table below

Status Indian Income Foreign Income

Resident and ordinarily resident Taxable Taxable
Resident but not ordinary resident Taxable Not Taxable
Non-Resident Taxable Not Taxable

AUTHOR – VYANKATESH GOTALKAR

5
ITR FILING December 28, 2017

Know how of Income Tax

 Income tax is levied on the 'total income' of the assesses.

 Income of the 'previous year' is taxed in the 'assessment year.'
 Income is classified into and computed under five categories called
'heads of income.'
 The basic scheme of income tax is the principle 'pay as you earn.'
 One must pay his taxes in advance and by the due dates, in the
prescribed percentages.
 Deferment in the payment of advance tax would result in the payment
of interest.

The income tax basic scheme is explained in brief as:

 Income tax is levied on the 'total income' of the assessable entity
which is computed under the provisions of the Act.
 The income which are pertaining to the 'previous year' is taxed, but in
the 'assessment year.'
 Income tax is charged at the rates being fixed by the for the year by
the annual Finance Act. But the liability to pay the tax is based on the
principle 'pay as you earn.'

Also check Taxable Heads of Income for the definition of salary, wages,
pension, allowance, etc.

Pay as you Earn

A person is not allowed to wait until 31 March to pay his/her taxes. The
Income Tax Act has the provision of 'pay as you earn.' This do not pinch a
tax payer at the end of the year making a lump sum payment. Such payments

PERSONAL TAX RATES

Income Tax Slab Rates for FY 2016-17(AY 2017-18)

AUTHOR – VYANKATESH GOTALKAR

6
ITR FILING December 28, 2017

PART I: Income Tax Slab for Individual Tax Payers & HUF (Less than 60
Years Old) (Both Men & Women)

Income Slab Tax Rate

Income up to Rs 2,50,000* No tax

Income from Rs 2,50,000 – Rs 5,00,000 10%

Income from Rs 5,00,000 – 10,00,000 20%

Income more than Rs 10,00,000 30%

Surcharge: 15% of income tax, where total income exceeds Rs.1 crore.

Cess: 3% on total of income tax + surcharge.

*Income tax exemption limit for FY 2016-17 is up to Rs. 2,50,000 for

individual & HUF other than those covered in Part(II) or (III)

PART II: Income Tax Slab for Senior Citizens (60 Years Old Or More
but Less than 80 Years Old)(Both Men & Women)

Income Slab Tax Rate

Income up to Rs 3,00,000* No tax

Income from Rs 3,00,000 – Rs 5,00,000 10%

AUTHOR – VYANKATESH GOTALKAR

7
ITR FILING December 28, 2017

Income Slab Tax Rate

Income from Rs 5,00,000 – 10,00,000 20%

Income more than Rs 10,00,000 30%

Surcharge: 15% of income tax, where total income exceeds Rs.1 crore.

Cess: 3% on total of income tax + surcharge.

*Income tax exemption limit for FY 2016-17 is up to Rs. 3,00,000 other

than those covered in Part(I) or (III)

PART III: Income Tax Slab for Senior Citizens (80 Years Old Or More)
(Both Men & Women)

Income Slab Tax Rate

Income up to Rs 2,50,000* No tax

Income up to Rs 5,00,000* No tax

AUTHOR – VYANKATESH GOTALKAR

8
ITR FILING December 28, 2017

Income Slab Tax Rate

Income from Rs 5,00,000 – 10,00,000 20%

Income more than Rs 10,00,000 30%

Surcharge: 15% of income tax, where total income exceeds Rs.1 crore.

Cess: 3% on total of income tax + surcharge.

*Income tax exemption limit for FY 2016-17 is up to Rs. 5,00,000 other

than those covered in Part(I) or (II)

How to Calculate Income Tax from Income Tax Slabs?

This example explains how to apply tax slabs to calculate income tax for
FY 2016-17 (AY 2017-18).

Rohit has a total taxable income of Rs 8,00,000. This income has been calculated by
including income from all sources such as salary, rental income, and interest income.
Deductions under section 80 have also been reduced. Rohit wants to know his tax dues
for FY 2016-17 (AY 2017-18).

AUTHOR – VYANKATESH GOTALKAR

9
ITR FILING December 28, 2017

Income Slab Tax Rate Tax Calculation

Income up to Rs 2,50,000 No tax

Income from Rs 2,50,000 – 10% (Rs 5,00,000 – Rs Rs 25,000

Rs 5,00,000 2,50,000)

Income from Rs 5,00,000 – 20% (Rs 8,00,000 – Rs Rs 60,000

10,00,000 5,00,000)

Income more than Rs 30% nil

10,00,000

Tax Rs 85,000

Cess 3% of Rs 85,000 Rs 2,550

Total tax in FY 2016-17 Rs 87,550

(AY 2017-18)

INCOME TAX SLAB FOR DOMESTIC COMPANIES FOR FY 2016-

17(AY 2017-18)

Income tax rate reduced to 29% (plus applicable surcharge and education
cess) for domestic companies whose total turnover/gross receipts does not
exceed Rs 5 crores.
In case you formed a manufacturing company, income tax rate of 25% for
domestic companies, if set-up and registered after 1 March 2016 and does
not claim any tax incentives.
In other cases, the tax rates remain unchanged at 30% (plus applicable
surcharge and education cess).
AUTHOR – VYANKATESH GOTALKAR

10
ITR FILING December 28, 2017

Effective tax rates are as under:

Particulars Turnover/Gross Turnover/Gross receipts more than

receipts less than Rs 5 Rs 5 crore
crores

Taxable Taxable Taxable Taxable Taxable

income income income less income income
less than more than than Rs 1 more than more than
Rs 1 crore Rs 1 crore crore Rs 1 crore Rs 10
but less crores
than Rs 10
crores

Corporate 29% 29% 30% 30% 30%

tax

Surcharge 0 7% 0 7% 12%

Corporate 29% 31% 30% 32.10% 33.60%

tax +
surcharge

Education 3% 3% 3% 3% 3%
cess

Effective 29.87% 31.96% 30.90% 33.06% 34.61%

tax rate

TDS (Tax deducted at source)

This tax is deducted at the source of income, by the employer or the payer
and paid to the government. It includes salary, interest, commission and
contract fees, rent, professional fees, etc. This type of deduction is popularly
known as TDS. Such tax is subject to certain limits and certain conditions.
For example if the earning up on fixed deposit is Rs. 5,000 in a bank, TDS at
10% and education cues at 2% i.e. a total of 10.2% will be deducted at the
time of credit or at the time of payment, whichever is earlier.

In case of senior citizen, if he/she estimates that the tax on the income is nil,
AUTHOR – VYANKATESH GOTALKAR

11
ITR FILING December 28, 2017

Form No.15H duly filled and signed is to be submitted in duplicate to the

bank. So, no TDS will be deducted. If the total income is less than the
threshold limit, Form No.15G is to be submitted to the payer to prevent TDS
from such interest.

TCS (Tax collected at source)

Unlike tax deducted at source, TCS is collected by a seller of certain
specified goods at the specified rates on the purchase of the goods and it is
remitted to the treasury on behalf of the buyer. In the same way, a person
granting a lease or license in a parking lot, toll-plaza, etc. collects the taxes
at the specified rates as tax paid on behalf of the lessee.

Advance Tax
Advance Tax is paid by the income earner during the previous year. The
computing of the liability of advance tax is done by estimating the 'total
income' for the year, calculating the surcharge and taking into consideration
the rebate that will be available. The advance tax is required to be paid in
three installments.

Schedule of Advance Tax:

On or before 15
A Not less than 30% of advance tax.
September
On or before 15 Not less than 60% of advance tax as reduced
B
December by amount paid earlier.
On of before 15 Full advance tax as reduced by the amount or
C
March amounts if any, paid in earlier installments.

If the assessee does not pays the advance tax as described above, an interest
of 1% is charged per month for 3 months for the deferment of advance tax
installment. If the total amount of advance tax is not paid on or before 15
March, an interest of 1% is charged for one month.

AUTHOR – VYANKATESH GOTALKAR

12
ITR FILING December 28, 2017

Further, if the total advance tax paid is less than 90% of the advance tax
payable, the interest at 1% per month is charged for the shortfall in the
advance tax paid for the period commencing from 1 April of the assessment
year and ending on the date of payment or assessment, whichever is earlier.

TAXABLE HEAD OF INCOME TAX

The total income of a person is divided into five heads, viz., taxable.

1. Income from Salary

2. Income from House Property
3. Income from profits and gains of Business or Profession
4. Income from Capital Gains
5. Income from Other sources

• Salary Income:-
In certain cases, an employee can claim both HRA (house rent
allowances) as well as interest on housing loan.

• House property Income :-

AUTHOR – VYANKATESH GOTALKAR

13
ITR FILING December 28, 2017

if interest paid for property given on rent is less than taxable

rent (after standard deduction -30%). Such loss can be set off against income
from other heads including income from salary.

• Income from capital gain:-

surplus from derivative contracts is non- speculation.
Archaeological collection, Drawings, Painting, Sculptures, Any other work
of Art. Thus, now any surplus received from sale of these articles would be
liable to tax under the head capital gain.

• Business income :-
Any type of income received from business

• Income from other sources:-

Dividend, Commission, lotteries, crossword puzzles, races
including horse races, card games, any sort or from gambling or betting

Individual Heads of Income

Income from Salary

All income received as salary under Employer-Employee relationship is

taxed under this head. Employers must withhold tax compulsorily, if income
exceeds minimum exemption limit, as Tax Deducted at Source (TDS), and
provide their employees with a Form 16 which shows the tax deductions
and net paid income. In addition, the Form 16 will contain any other
deductions provided from salary such as:

1. Medical reimbursement: Up to Rs. 15,000 per year is tax free if

supported by bills. (Company pays Fringe Benefit Tax on this amount)
2. Conveyance allowance: Up to Rs. 800 per month (Rs. 9,600 per year)
is tax free if provided as conveyance allowance. No bills are required
for this amount.
AUTHOR – VYANKATESH GOTALKAR

14
ITR FILING December 28, 2017

3. Professional taxes: Most states tax employment on a per-professional

basis, usually a scabbed amount based on gross income. Such taxes
paid are deductible from income tax.
4. House rent allowance: the least of the following is available as
deduction
1. actual HRA received
2. 50%/40%(metro/non-metro) of 'salary'
3. rent paid minus 10% of 'salary'. Salary for this purpose is
basic+DA forming part+commission on sale on fixed rate.

Income from salary is net of all the above deductions.

Income From House property

Income from House property is computed by taking what is called Annual

Value. The annual value (in the case of a let out property) is the maximum of
the following:

 Rent received
 Municipal Valuation
 Fair Rent (as determined by the I-T department)

If a house is not let out and not self-occupied, annual value is assumed to
have accrued to the owner. Annual value in case of a self occupied house is
to be taken as NIL. (However if there is more than one self occupied house
then the annual value of the other house/s is taxable.) From this, deduct
Municipal Tax paid and you get the Net Annual Value. From this Net Annual
Value, deduct :

 30% of Net value as repair cost (This is a mandatory deduction)

 Interest paid or payable on a housing loan against this house

In the case of a self occupied house interest paid or payable is subject to a

maximum limit of Rs,1,50,000 (if loan is taken on or after 1 April 1999) and
Rs.30,000 (if the loan is taken before 1 April 1999). For all non self-
occupied homes, all interest is deductible, with no upper limits.

The balance is added to taxable income.

AUTHOR – VYANKATESH GOTALKAR

15
ITR FILING December 28, 2017

Income from Business or Profession

o carry forward of losses

An example .. An architect works out of home and co-ordinates work for his
clients. All the following expenses would be deductible from his
professional fees.

 he uses a computer,
 he travels to sites in his car,
 he has a peon to help him collect payments
 He has a maid who comes in daily
 part of the society maintenance bills
 entertainment expenses incurred..
 books and magazines for his professional practice.

The income referred to in section 28, i.e, the incomes chargeable as "Income
from Business or Profession" shall be computed in accordance with the
provisions contained in sections 30 to 43D.

The computation of income under the head "Profits and Gains of Business or
Profession" depends on the particulars and information available.

Income from Capital Gains

Transfer of capital assets results in capital gains. A Capital asset is defined

under section 2(14) of the I.T. Act, 1961 as property of any kind held by an
assessee such as real estate, equity shares, bonds, jewellery, paintings, art
etc. but does not include some items like any stock-in-trade for businesses
and personal effects. Transfer has been defined under section 2(47) to
include sale, exchange, relinquishment of asset, extinguishment of rights in
an asset, etc. Certain transactions are not regarded as 'Transfer' under section
47.

For tax purposes, there are two types of capital assets: Long term and short
term. Long term asset are held by a person for three years except in case of
shares or mutual funds which becomes long term just after one year of

AUTHOR – VYANKATESH GOTALKAR

16
ITR FILING December 28, 2017

holding. Sale of such long term assets gives rise to long term capital gains.
There are different scheme of taxation of long term capital gains. These are:

1. As per Section 10(38) of Income Tax Act, 1961 long term capital
gains on shares or securities or mutual funds on which Securities
Transaction Tax (STT) has been deducted and paid, no tax is payable.
STT has been applied on all stock market transactions since October
2004 but does not apply to off-market transactions and company
buybacks; therefore, the higher capital gains taxes will apply to such
transactions where STT is not paid.
2. In case of other shares and securities, person has an option to either
index costs to inflation and pay 20% of indexed gains, or pay 10% of
non indexed gains. The indexation rates are released by the I-T
department each year.
3. In case of all other long term capital gains, indexation benefit is
available and tax rate is 20%.

All capital gains that are not long term are short term capital gains, which
are taxed as such:

 Under section 111A, for shares or mutual funds where STT is paid,
tax rate is 10% From Asst Yr 2005-06 as per Finance Act 2004. For
Asst Yr 2009-10 the tax rate is 15%.
 In all other cases, it is part of gross total income and normal tax rate is
applicable.

For companies abroad, the tax liability is 20% of such gains suitably indexed
(since STT is not paid).

Income from Other Sources

This is a residual head, under this head income which does not meet criteria
to go to other heads is taxed. Also there are also some specific incomes
which are to be taxed under this head.

1. Income by way of Dividends

AUTHOR – VYANKATESH GOTALKAR

17
ITR FILING December 28, 2017

2. Income from horse races

3. Income from winning of lotteries
4. Income from winning bull races
5. Any amount received from key man insurance policy.
6. Any sort or from gambling or betting
7. Income from commission
8. Income from crossword puzzles
9. Income from card games

Income Exempt from Tax

Sections 10,10A, 10AA, 10B, 10BA, and 13A deal with income which does
not form part of an assessee's total income. While section 10 provides a list
of income absolutely exempt from tax, sections 10A, 10AA, 10B, 10BA,
and 13A deal with specific exemptions available to newly established
industrial undertakings in free trade zones, and political parties. These
exemptions are provided from social, political, Constitutional
considerations, for avoiding double taxation, on the basis of casual and non-
recurring nature ,on the basis of non-residents and non-citizens status, on the
basis of Certain specific securities, bonds, certificates, funds and the like, on
the basis of Education, science, research, achievements, rewards, sports,
charity, on the basis of certain types of bodies, funds and institutions,
Subsidies to promote business, and international, economic, and other
considerations. Sikkim is the only state of India where citizens do not pay
income tax. Residents of Sikkim are eligible for this exemption but
excluding the non-Sikkimese spouse of a Sikkimese.

AUTHOR – VYANKATESH GOTALKAR

18
ITR FILING December 28, 2017

Agricultural Income [Section 10(1)] Eligible Assesses :- All assesses

Exempt income :- Agricultural income Other points :- Agricultural income
means as it is defined in Section 2(1A) In case of individual, HUF, AOP,
BOI, unregistered firms and artificial juridical persons, agricultural income
is to be aggregated for the purpose of determining the rate of tax on Non-
Agricultural income and they would get tax rebate or relief.

Dividends

Dividend income (as referred u/s 115-O of the I.Tax Act) paid by Companies
and Mutual Funds are exempt from tax. A 15% dividend distribution tax and
surcharge of 3% is paid by companies before distribution. Equity mutual
funds (with more than 65% of assets invested in equities) do not pay a
dividend distribution tax, though other funds do. Liquid and Money Market
funds pay 25% dividend distribution tax.01123

Other Exempt Income

The Indian Income tax act specifically exempts certain income from tax:

 Money received from an Insurance company as proceeds of an

insurance policy (by way of an insurance claim, or by maturity) is
generally exempt. However there are three types of payments under
life insurance policy that are not tax free . These are :

 any sum received under sub-section (3) of section 80DD or sub-

section (3) of section 80DDA - this refers to specific policies
for disabled dependents; or
 any sum received under a Keyman insurance policy; or
 any sum received under policies issued on or after 1 April 2003
where premium paid is greater than 1/5th the sum assured

 Maturity proceeds of a Public Provident Fund (PPF) account.

AUTHOR – VYANKATESH GOTALKAR

19
ITR FILING December 28, 2017

DEDUCTIONS

Section 80 Deduction Table

Section Deduction on FY 2016-17

80CC For amount deposited in annuity –

plan of LIC or any other insurer
for pension from a fund referred to
in Section 10(23AAB).

80CCD(1) Employee’s contribution to NPS –

account (maximum up to Rs
1,50,000)

AUTHOR – VYANKATESH GOTALKAR

20
ITR FILING December 28, 2017

Section Deduction on FY 2016-17

80CCD(2) Employer’s contribution to NPS Maximum up to 10% of salary

account

80CCD(1B) Additional contribution to NPS Rs. 50,000

80TTA(1) Interest Income from Savings Maximum up to 10,000

account

80GG For rent paid when HRA is not Least of :

received from employer  Rent paid minus 10% of
total income
 Rs. 5000/- per month

 25% of total income

80E Interest on education loan Interest paid for a period of 8

years

80EE Interest on home loan for first time Rs 50,000

home owners

80CCG Rajiv Gandhi Equity Scheme for Lower of

investments in Equities  50% of amount invested
in equity shares or

 Rs 25,000

80D Medical Insurance – Self, spouse, Rs. 25,000

children Rs. 30,000
Medical Insurance – Parents more
than 60 years old or (from FY
2015-16) uninsured parents more
than 80 years old

AUTHOR – VYANKATESH GOTALKAR

21
ITR FILING December 28, 2017

Section Deduction on FY 2016-17

80DD Medical treatment for handicapped o Rs. 75,000

dependent or payment to specified
scheme for maintenance of  Rs. 1,25,000
handicapped dependent
 Disability is 40% or more
but less than 80%

 Disability is 80% or more

80DDB Medical Expenditure on Self or  Lower of Rs 40,000 or

Dependent Relative for diseases the amount actually paid
specified in Rule 11DD  Lower of Rs 60,000 or
 For less than 60 years old the amount actually paid
 For more than 60 years old
 Lower of Rs 80,000 or
 For more than 80 years old the amount actually paid

80U Self suffering from disability:

 Individual suffering from a o Rs. 75,000
physical disability
(including blindness) or  Rs. 1,25,000
mental retardation.

 Individual suffering from

severe disability

80GGB Contribution by companies to Amount contributed (not

political parties allowed if paid in cash)

80GGC Contribution by individuals to Amount contributed (not

political parties allowed if paid in cash)

80RRB Deductions on Income by way of Lower of Rs 3,00,000 or

Royalty of a Patent income received

AUTHOR – VYANKATESH GOTALKAR

22
ITR FILING December 28, 2017

INCOME TAX E-FILING

E-filing of Tax Returns

• The process of electronically filing Income tax returns through the

internet is known as e-Filing.
• It is mandatory for Companies and Firms requiring statutory audit u/s
44AB to submit the Income tax returns electronically for AY 2009-10.
– Any Company/Firm requiring statutory audit u/s 44AB return
submitted without a e-Filing receipt will not be accepted.
• e-filing is possible with or without digital signature.

The Income Tax Department is keen to encourage efiling of IT returns by all

taxpayers in view of the following benefits to taxpayers.

 Anywhere-Anytime Filing
 No long queues
 No Personnel Interface
 Quick Processing
 Accurate data in return

Paid taxes, made your tax saving investments... now get geared up for filing
income tax returns as the month of July is on the horizon and the time has
come when one is supposed to file IT returns.

In the year 2007 the Income Tax Department of India took many initiatives
such as training TRPS, launching saral forms in a new avatar and so on for
making tax filing convenient and handy for the citizens.

In this e-age when ICT is successfully intervening in so many fields and

providing services from online banking to online news, online mutual fund
investments to online buying and selling, the Income Tax Department of
India launched the Electronic Filing of income tax returns.Yes, using the e-
AUTHOR – VYANKATESH GOTALKAR

23
ITR FILING December 28, 2017

filing process one can file in tax returns just within a few clicks at any time
of the day and that too without any hassles. Using this technology all you
have to do is fill the form and submit it, online or offline.

MORE ABOUT THE E-FILING PROCESS WORK

The e-filing process is really easy and takes a very little time and all you
have to do is fill up your tax return form online provided and the other
required information about income, expenditure and savings. Filing tax
returns online is the easiest and the simplest method and all one needs is to
log on and follow the simple instructions.

For e- filing process one needs to have a software application that generates
the income tax form, which is available at the Income Tax Department
website.

Benefits of e-Filing:

One of the foremost benefits of electronic filing is the facility of anywhere /

anytime filing, and one can just file returns anytime of the day or night.
Other than this, online tax returns are processed much faster than paper
returns and the tax is worked out automatically as the payee completes the
form. With this the payee also gets the acknowledgement slip immediately.
Also online filing is a safe and secure mode.

AUTHOR – VYANKATESH GOTALKAR

24
ITR FILING December 28, 2017

TYPES OF E-FILING
 There are three ways to file returns electronically.

 Option 1: Use digital signature, in which case no further action is

required.

 Option 2: File without digital signature, in which case ITR-V form is

to be filed with the department. This is a single page receipt cum
verification form.

 Option 3: File through an e-return intermediary who would do eFiling

and also assist the Assessee file the ITR -V Form.

AUTHOR – VYANKATESH GOTALKAR

25
ITR FILING December 28, 2017

AUTHOR – VYANKATESH GOTALKAR

26
ITR FILING December 28, 2017

Documents required for e-filing

• Form No. 16 (for Tax deducted by employers)

• Form No. 16A

• Account statements of bank accounts

• Property details

• Sale and purchase of investments / assets

• Details of tax payments made

• PAN card photo copy

• Birth date

• TAN number

• Bank A/c no

• Bank details – MICR code, Type of A/c

AUTHOR – VYANKATESH GOTALKAR

27
ITR FILING December 28, 2017

AUTHOR – VYANKATESH GOTALKAR

28
ITR FILING December 28, 2017

12 Step Process for Filing Tax Returns

Whether you wish to go in for the quick e-filing process or manually file
your income tax returns, here is a helpful guide to assist you in completing
and submitting this vital document by yourself.

1) Go to the website https://www.incometaxindiaefiling.gov.in/home

2) Click the link eFile Income Tax Return at the top left corner of the
home page

3) Select the Correct Form - There are two income tax forms for salaried
individuals. ITR-1 is for those who derive their income from salary, pension
or interest while ITR-2 is for income from capital gains, house property and
other sources. Those who wish to submit their tax returns manually may
download the pdf forms - External website that opens in a new window from
here. These forms need to be printed, filled by hand and signed before submitting to your
local income tax office.

AUTHOR – VYANKATESH GOTALKAR

29
 ITR FILING December 28, 2017

For Individuals, HUF (Hindu Undivided Families)

Select appropriate ITR-1 ITR-2 ITR-3 ITR-4
Income Tax Return
Individual Individual Individual Individu
(ITR) Preparation
Software & HUF & HUF & HUF
1 Income from
▪ ▪ ▪
Salary/Pension
2 Income from Other
Sources (only Interest
▪ ▪ ▪
income or Family
Pension)
3 Income/Loss from
▪ ▪
Other Sources
4 Income/Loss from
▪ ▪
House Property
5 Capital Gains/Loss on
sale of ▪ ▪
investments/property
6 Partner in a partnership
▪
Firm
7 Income from
Proprietary
Business/Profession

Select appropriate type of Return Form ITR 1 to ITR 8

For Association of Persons (AoP), Body of Individuals (BoI), Local Authority,

AUTHOR – VYANKATESH GOTALKAR

30
 ITR FILING December 28, 2017

Companies, Trusts, Fringe Benefit Tax (FBT) Return

Select appropriate Income ITR-5 ITR-6 ITR-7 ITR-8

Tax Return (ITR)
Preparation Software Firms, Companies Trusts Only
AoP, FBT
BoI,
LA
1 Income/Loss
from Other ▪ ▪ ▪
Sources
2 Income/Loss
from House ▪ ▪ ▪
Property

3 Capital
Gains/Loss on
sale of ▪ ▪ ▪
investments/prop
erty
4 Income/Loss
from Business ▪ ▪ ▪

5 Fringe Benefit
Tax ▪ ▪ ▪ ▪

ITR-7 will not be available for e-Filing

WHO CAN USE WHICH FORM

ITR-1

AUTHOR – VYANKATESH GOTALKAR

31
ITR FILING December 28, 2017

This Form can be used by an individual whose total income during the
previous year i.e., financial year 2008-09 includes income chargeable to
income-tax under the head “salaries” or income in the nature of family
pension as defined in the Explanation to clause (iia) of section 57 but does
not include any other income except income by way of interest chargeable to
income-tax under the head “income from other sources”. There should not
be any exempt income other than agriculture income and interest income. It
may please be noted that a person who is entitled to use this form shall not
use Form ITR-2. Further, a person in whose income the income of other
person like his/ her spouse, minor child, etc. is to be clubbed is also not
entitled to use this form.

ITR-2

This Form can be used by an individual or a Hindu Undivided family whose

total income does not include any income chargeable to income-tax under
he head “Profits or gains of business or profession”. It may please be noted
that a person who is entitled to use Form ITR-1 shall not use this form.
Further, a person who is partner in a firm is required to use Form ITR-3. In
case a partner in the firm does not have any income from the firm by way of
interest, salary, etc. and has only exempt income by way of share in the
profit of the firm shall not use Form ITR-2.

ITR-3

This Form can be used a person being an individual or a Hindu Undivided

family who is a partner in a firm and where income chargeable to income-
tax under the head “Profits or gains of business or profession” does not
include any income except the income by way of any interest, salary, bonus,
commission or remuneration, by whatever name called, due to, or received
by him from such firm. In case a partner in the firm does not have any
income from the firm by way of interest, salary, etc. and has only exempt
income by way of share in the profit of the firm shall use this form only and
not Form ITR-2.
ITR-4

AUTHOR – VYANKATESH GOTALKAR

32
ITR FILING December 28, 2017

This Form can be used by a person being an individual or a Hindu

Undivided family who is carrying out a proprietary business or profession.

ITR-5

This Form can be used a person being a firm, AOP, BOI, artificial juridical
person referred to in section 2(31)(vii), cooperative society and local
authority. However, a person who is required to file the return of income
under section 139(4)(a) or 139(4)(a) or 139(4)(b) or 139(4)(c) or 139(4)(d)
shall not use this form.

ITR-6

This Form can be used by a company, other than a company claiming

exemption under section 11

ITR-7

This Form can be used by persons including companies who are required to
furnish return under section 139(4A) or under section 139(4B) or under
section 139(4C) or under section 139(4D).

ITR-8

This Form is applicable in case of a person who is not required to furnish the
return of income but is required to furnish the return of fringe benefits

4) Use of Return Preparation Software - Those citizens who wish to avail

the e-filing system need to download the Return Preparation Software -
External website that opens in a new window for each ITR form. This
software is an excel file that requires one to type in personal details as well
AUTHOR – VYANKATESH GOTALKAR

33
ITR FILING December 28, 2017

as financial information from TDS certificates, bank statements, deductions

made and interest statements.

5) Generating an XML file - After keying in the details, check once for
accuracy. After you are satisfied, click the 'Generate' button to create your
tax return in XML format. This format helps in sharing of structured data
across different information systems. Save this XML file on your computer.

6) Register - The next step requires you to Register at the Income Tax
website - External website that opens in a new window. Your registered
Permanent Account Number (PAN card) has to be entered as your username.

7) Login - After registering, enter your user id and password to login. Click
on the relevant form on the left panel and select 'Submit Return'.

8) Upload XML - Browse to select the XML file, which you had generated
and saved in Step 3. Click on the 'Upload' button to upload the file.

9) Acknowledgement - After the file is successfully uploaded,

acknowledgement details or the ITR-V Form will be displayed. Take a
printout of this acknowledgement for your records.

AUTHOR – VYANKATESH GOTALKAR

34
ITR FILING December 28, 2017

10) Digital Signature - If your income tax return was digitally signed, then
no further paperwork or visit to the income tax office is needed. Here is
some information about how to get a digital signature - External website that
opens in a new window.

Instructions for filling up FORM ITR-V

AUTHOR – VYANKATESH GOTALKAR

35
ITR FILING December 28, 2017

1. Rule 12(3)(iii) of the Income-tax Rules, 1962 provides that any assessee
can file a return of income electronically without the use of a digital
signature. In such cases only an acknowledgement needs to be filed with the
Department physically by the assessee.
2. Once a return of income is filed electronically on successful transmission
of the data, Form ITR-V duly filled shall be generated by the Income-tax
Department’s server to the assessee. This ITR-V will also contain the
acknowledgement number of electronic transmission and the date of the
transmission as an evidence of filing for the benefit of the assessee. Please
down load a copy of such duly filled Form and verify under your signature
in the space provided. In case the return was prepared by a Tax Return
Preparer (TRP), the particulars of TRP be also filled and this verification
form be countersigned by the TRP.
3. This acknowledgement in Form ITR-V duly signed by the assessee needs
to be filed physically (in duplicate) with the concerned Assessing Officer.
One copy of this acknowledgement would be returned back to the assessee
for his record.
4. The codes for the form number and the status of the assessee shall be
generated electronically by the Department’s server.

11) Verification - If your return is not digitally signed, then you need to
print and fill up the verification part of the acknowledgement cum
verification form (ITR-V). This has to be signed and submitted to the local
Income Tax Office within 15 days to complete the e-filing process.

12) Additional Assistance - In case you require any more help in filing the
paper copy of the return, please contact the Public Relations Officer at your
local Income Tax Office. One may also phone the Aayakar Sampark Kendra
(ASK) call centre at 124-2438000 or email at [email protected].

SUMMARY AND CONCLUSION

AUTHOR – VYANKATESH GOTALKAR

36
ITR FILING December 28, 2017

SUMMARY OF LEARNINGS EXPERIENCE

• To get initial success in this field is very difficult. Although the business
generation becomes easier with time as we serve more people who then get
added up in the loyal clientage. Thus time and service are two most factors
to get in this field.
• Also the corporate remains a very important segment which gets business
in bulk but retail cannot be ignored which makes your business ticking.
• Customer remains in the pivotal position.

CONCLUSION:
Under the umbrella of my project, we the participants of this project were
glad to understand the design and pattern of income tax e-filing online. My
experience with the various customers of the various companies was totally
different and gave us an edge adding to my knowledge.

BIBLIOGRAPHY:

AUTHOR – VYANKATESH GOTALKAR

37
ITR FILING December 28, 2017

Websites:
www.incometaxindiaefiling.gov.in
www.valueplus.njfundz.com
www.legalserviceindia.com
www.finance.indiamart.com
https://en.wikipedia.org/wiki/Income_tax_return_(India)

Reference books:
1. BASIC PRINCIPLES OF INCOME TAX LAWS
2. HOW TO SAVE YOUR TAX
3. BASIC INCOME TAX TIPS

AUTHOR – VYANKATESH GOTALKAR

38