What are the documents required for ITR filing?

Last Updated: 29 Jun 2022

Filing your income tax return can be intimidating, especially if you’re beginning to manage your finances. While the I-T department has simplified ITR filing by providing taxpayers with an online service to file their ITRs, there are still certain things you should know before you start this process yourself.

Every income tax-paying individual must file an income tax return every year. However, some are exempt from filing tax returns or having a certain limit for which they do not need to pay taxes. The requirement of filing income tax returns is governed by Section 139(4) of The Income-tax Act, 1961. Under section 139 (4), every person other than companies and other artificial juridical persons (such as clubs, societies etc.) whose total income exceeds Rs. 50,000/- shall make an income tax return before September 30 following the end of the assessment year.

These returns are to be filed with tax authorities before specified deadlines. All taxpayers must use a printed ITR-1 or ITR-2 and applicable online signature and filing authorization. These forms have been designed as self-assessment tools by CBDT for those who wish to take responsibility for their tax affairs. The forms provide options for taxes paid at higher rates under personal headings, interest paid on housing loans, donations, medical insurance premiums, children studying abroad, assets located outside India held through non-resident entities etc. ITRs can now also be pre-filled with information obtained from Aadhaar cards.

The taxpayers need to mention PAN details, Tax Deducted at Source (TDS) if any, TDS claimed as exempt u/s 194C, details of all bank accounts including dormant ones, details of all immovable properties held, including the value of purchase price/current value/area/details etc., description and address details etc.

Documents Required to Claim Expenses as Deductions

If you want to claim any of these expenses as deductions in your income tax return, they must meet both these conditions:

1. The expense is not reimbursed by your employer
2. It has a direct relationship with earning your salary or professional income.

For example, if you can show that an office car is used mainly for business purposes and is essential for carrying out job responsibilities, then it qualifies as a business expense. A home-office deduction may be allowed for employees who use part of their house exclusively for work. But, if there are no clear boundaries between work and private space, it’s unlikely to qualify as a business expense.

What are the steps to file ITR?

The steps to file ITR in India are given below:

1. File your income tax return before June 30 of each year. The due date for filing income tax returns (ITR) for individuals and HUFs (other than companies and institutions) in India, has been extended from July 31 to August 5 by CBDT Chairman Sushil Chandra in a tweet.
2. Don’t wait till it’s too late; if you miss out on filing your return, you will have to pay a penalty of Rs 10,000 or ₹200 per day for delay depending on whichever is higher.
3. Completing and submitting an IT return in itself doesn’t mean you have paid all taxes; its primary purpose is to help you monitor any possible refund due to you.
4. A TDS certificate must be obtained from banks and financial institutions where we hold funds to submit your ITR. They include banks, mutual funds, life insurance companies etc.,
5. According to media reports, a TDS certificate must be obtained from banks and financial institutions where they hold funds to submit ITR. They include banks, mutual funds, life insurance companies etc. Most taxpayers rely on information submitted by service providers such as banks and do not check what they have submitted themselves.
6. An ITR-V form can be used to declare undisclosed income which was inadvertently omitted from one’s earlier ITRs. This can also serve as a claim for addition in taxable income when it is accompanied by additional relevant supporting documents such as bank statements, interest receipts or cancelled cheques that may support unaccounted incomes claimed in later years

Is a bank account necessary for ITR filing?

No. Even if you do not have a bank account, you can still e-file your return by simply visiting any of the 1,000+ Common Service Centres (CSCs) across India and over 100 CSCs abroad. Each CSC has an online facilitation centre where you can file your ITR for free, even if you do not have a bank account.

Besides helping with ITR filing, CSCs also provide access to Aadhaar card generation services and allow citizen registration through mobile applications such as myAadhaar. To receive refunds from the income tax department, taxpayers would need either a savings or current account in any one of India’s authorised banks or post offices.

An alternative way is to walk into any one of ICICI Bank’s banking correspondent locations and deposit money in a savings account linked with a beneficiaries’ Aadhaar number — there are 8 lakh banking correspondents, covering all Indian villages. This facility too is valid for taxpayers who do not have a bank account of their own. There is no minimum amount required for payment of taxes using these channels. The maximum amount permissible at a time on a single credit/debit card transaction at CSCs and Banks/Post Offices is Rs 10,000/- against which service charges will be applicable as notified by CBDT from time to time.

Not all income is taxable, and if you have a home office or write off any other business expenses, for example, you’ll need to declare that or your return could be flagged for review. Furthermore, to get your refund quickly and with minimal fuss, don’t miss out on valuable deductions.

Take a few minutes to double-check everything before submitting. It will ensure that your tax payment is processed efficiently and will give you peace of mind as well. Keep good records throughout the year; make sure you save copies of receipts and invoices, as well as any reports from cloud accounting services such as QuickBooks.

Final Words

If you do make a mistake on your return (and we all do), document it with an explanation, along with proof of the earlier erroneous report. This will save time both at filing time and later during an audit. There are some steps you can take ahead of time to help avoid getting audited, too. Reviewing your tax situation every year (especially in turbulent financial times) can also help reduce stress during April. Just make sure to take precautions when storing sensitive information online. Consider encrypting personal data in Google Drive or Dropbox.