In the world of financial responsibility, filing Income Tax Returns (ITR) stands out as a crucial obligation for salaried individuals. This process helps people follow the law and handle their money better. Our guide titled ‘How to file income tax return online by salaried individuals’ is here to make online tax filing easier for salaried people. We want to make filing ITR less scary by explaining the steps and what you need to do.

Who is Considered a Salaried Employee for E-Filing of ITR?

A salaried employee is someone who gets a set amount of money from their employer for the work they do. This includes not just the salary but also any extra payments or benefits from the employer. Salaried individuals are obligated to pay income tax on their earnings after deducting eligible deductions and exemptions as per the Income Tax Act, 1961. Consequently, filing an income tax return annually becomes imperative to report income details, claim deductions, disclose taxes paid and request refunds, if applicable.

Necessary Documentation for Salaried Individuals Filing ITR

Before initiating the ITR filing process, it is essential to gather all relevant documents pertaining to income, deductions and exemptions. These documents typically include Form 16 (TDS certificate) issued by the employer, salary slips, bank statements, investment statements and any other documents reflecting income sources. Also, Form 26AS on the TRACES portal through the Income Tax Portal gives helpful information about TDS and TCS, which helps calculate taxes correctly.

Identifying the Appropriate ITR Form for Salaried Employees

Selecting the correct ITR form is important to ensure accurate and compliant tax filing. While salaried employees primarily utilize ITR-1 (SAHAJ) or ITR-2 forms, the choice depends on the nature and sources of income. Here is a brief overview of the applicable ITR forms:

ITR-1: Designed for resident individuals with income up to INR 50 lakh, earning from salary or pension, income from a single-house property and other sources like interest and dividends.

ITR-2: Suitable for individuals and Hindu Undivided Families (HUFs) with income exceeding INR 50 lakh, holding foreign assets, investing in unlisted equity shares or serving as directors of companies.

ITR-3: Intended for individuals with business or professional income in addition to other sources like salary, capital gains and interest/dividends.

ITR-4: Geared towards individuals with income up to INR 50 lakh, particularly those availing presumptive taxation under sections 44AD, 44ADA or 44AE.

Choosing the appropriate ITR form ensures accurate disclosure of income and deductions, streamlining the tax filing process for salaried employees.

Step-by-Step Guide to Online Income Tax Filing Using Tax2win Software

To simplify the ITR filing process for salaried employees, let us walk through a step-by-step guide using the software:

Access the website and sign in with existing credentials or create a new account if new to the platform.

Identify relevant income sources from the provided options, allowing the software to determine the suitable ITR form based on selections.

Specify the Financial Year and input PAN details along with Date of Birth. An OTP will be sent for verification, facilitating account creation if necessary.

Provide essential personal information including name, email ID, date of birth, father’s name and gender, ensuring accuracy.

Enter address details and select the employer category, if applicable.

For salaried employees, input employment details including gross salary/CTC, exempted allowances, net salary, standard deduction, and professional tax under section 16. Form 16 uploads pre-fill employment data, simplifying the process.

Report investments made during the year to claim applicable deductions under various sections, ensuring comprehensive tax optimization.

Furnish bank details including IFSC code, bank name, account number, and Aadhaar details for seamless refund processing.

Upload Form 26AS for automatic population of TDS details, facilitating accurate tax computation and refund claims.

Select “Original Return” and specify any additional details required for accurate filing.

Review tax liability computed by the software under both old and new tax regimes, enabling informed decision-making.

Review all information, verify accuracy and proceed to file the return. E-verification completes the process, ensuring compliance and submission.

With this easy guide, salaried folks can file their taxes online confidently, ensuring they follow the rules and get all the tax benefits they deserve.

When Should Salaried Individuals File ITR?

For salaried individuals, filing an income tax return is contingent upon surpassing the prescribed threshold limit. As per the regulations for the financial year 2022-23, individuals must file ITR if their annual income exceeds INR 2,50,000. However, for the financial year 2023-24, the threshold limit under the new tax regime has been raised to INR 3,00,000.

In essence, salaried individuals should file their income tax returns for FY 2022-23 (Assessment Year 2023-24) only if their annual income exceeds INR 2,50,000, adhering to statutory requirements and ensuring compliance.

Why File Income Tax Returns

Filing income tax returns offers several benefits for salaried individuals, extending beyond mere compliance:

Individuals can claim refunds for excess tax deductions, including TDS on rent or fixed deposits, ensuring optimal tax optimization and financial management.

An ITR is an important paper that shows how much money you make each year. It helps when you want to get a loan because it proves your income and can make it easier to get approved.

Some foreign embassies require ITR receipts for visa applications, validating income sources and enhancing visa approval likelihood.

Filing ITR is particularly advantageous for individuals investing in the stock market, allowing for the carry-forward of short-term capital losses for up to eight years, optimizing tax planning and wealth management.

Verdict

Filing taxes online is important for salaried people to handle their finances properly and follow the rules. With easy-to-use websites and simple instructions, you can do it confidently and make sure your taxes are right, getting all the benefits you can. As tax rules change and technology improves, using tech tools helps you manage your money well and meet your tax duties without stress.