The income tax department has categorised taxpayers into groups based on their income situations which help in determining which ITR form is to be filed. This is to make tax compliance easier.
It is important for salaried individuals to file their returns. The advantages of filing an income tax return are- it is required for availing loans, travelling abroad, claiming a refund, etc. In this article, we discuss how to file income tax returns online for salaried employees.
Who is eligible to file Form ITR-1?
Form ITR-1 also known as Sahaj form is a simplified one-page form for resident individuals having taxable income up to INR 50 Lakhs in a FY from the following sources:
- Income from Salary/ Pension
- Income from only one House Property (excluding where there is brought forward loss from the previous year)
- Income from Other Sources (excluding income from horse races or lottery income or agriculture income more than INR 5K)
- In the case where provisions of clubbing are attracted then this form can be used subject to income limited to the above specifications.
Note: Further an individual who is either a director of a company/ partner in a firm or holds unlisted shares at any time during the FY can not file ITR-1.
Budget 2022 Update
The government has proposed an “Updated Return” that enables taxpayers to file ITR for two previous assessment years for any mistake or omission made in ITR on payment of additional tax and late filing penalty.
ITR 1 Form Breakdown
The ITR 1 form has 5 sections that are required to be confirmed before submitting it. The sections are mentioned below:
- Personal Information
- Gross Total Income
- Total Deductions
- Tax Paid
- Total Tax Liability
File ITR 1 Online on the e-Filing Website
- Log in to the e-filing portal using your PAN/TAN/user ID & password.
- Click on e-file > Income Tax Returns > File Income Tax Return from the dashboard
- Select the appropriate assessment year
- Select the online mode of filing the ITR
- Select the applicable status and click on proceed
- Select the Form ITR 1 option from the list provided
- Once you have selected the ITR applicable to you, note the list of documents needed and click Let’s Get Started
- Select the checkboxes applicable to you and click Continue
- Review your pre-filled data and edit it if necessary. Enter your income and deduction details in the different sections. After completing and confirming all the sections of the form, click Proceed
- In case there is a tax liability, you will be provided with the option to pay it at that instant or you can pay it later. If you opt to pay the tax then after payment, enter the challan details in the Schedule Taxes Paid, and click Preview Return.
- If there is no tax liability payable or a refund based on tax computation, you will be taken to the Preview and Submit Your Return page.
- On the Preview and Submit Your Return page, enter Place, select the declaration checkbox and click Proceed to Validation
- Once validated, click Proceed to Verification
- Complete your Verification based on your preferred option and click Continue
- On the e-Verify page, select the option through which you want to e-Verify the return and click Continue. On successful verification your ITR will be filed.
How to File ITR 1 using offline JSON utility?
We have to first download this offline utility from the e-Filing portal. After an individual has installed the Offline JSON Utility on their system, they will be taken to the Homepage for filing the Income Tax Return.
- Click on Continue
On the homepage click on continue to file your ITR.
- Select the applicable option
You will find 3 tabs namely: Returns, Draft Version of Returns and Pre-filled Data. Select the option that is applicable to you and click on ‘File Returns’
- Click on ‘Import Pre-filled Data’
Now, you have to select the ‘Import Pre-filled Data’ option. This will import all the data that you have already saved on your system and will pre-fill information in the ITR
- Enter the PAN and Assessment Year
Now, enter the PAN details of the taxpayer and select the assessment year, and then click on proceed
- Download the ‘Pre-filled JSON’
Next, download the pre-filled JSON from the e-filing website by logging into your account.
- Upload the Pre-filled JSON File
Now, upload the pre-filled JSON file downloaded and click on proceed
- Click on ‘File Return’
Now you will be redirected to the file ITR screen which will contain your pre-filled information from the JSON file
- Select the Status
Next, select the applicable status and click on continue
- Select ‘ITR 1’
Now from the options given select ITR 1
- Click on ‘Let’s get started’
In order to start preparing your ITR, click on ‘Let’s get started’
- Fill in the applicable and mandatory fields of the Form
Enter all the necessary and applicable details, validate all the tabs of the ITR form and then Tax will be calculated
- Now Submit your Return
After you have confirmed all schedules, you can submit and preview your return
- Download or Print the Preview
You can now download or print the preview on your system for your reference
- Click on ‘Proceed to Validation’
Now return to the screen and click on ‘Proceed to Validation’ to validate the return
- Validate the Errors
If there are any validation errors, the taxpayer will modify that, post that one can “Download the
JSON” and file it on the income tax website.
How to report Salary Income in the ITR without Form 16?
Employers may fail to provide Form 16 to their employees due to a number of reasons. In such a case, employees find it difficult to file an ITR without Form 16 since they don’t know their taxable salary and TDS amount.
Here are the steps to report salary income in ITR without Form 16
- You can know your taxable salary for a particular financial year from Line No. 6 of Form 16 Part-B. But when you have not received Form 16 from your employer, you need to calculate your taxable salary for a financial year from payslips
- Add up all the gross salary received during the year
- Deduct the allowances to the extent exempt from tax such as
- HRA, LTA, Conveyance Allowance, and other allowances
- Deduct any tax on employment and claim deduction for investment to EPF by you
- In case you changed jobs during the year, you need to consider the total gross salary from all the employers while calculating taxable salary income.
Sample Income Tax Return Form – ITR 1
Major Changes in ITR 1
- Pensioners now must select ‘Nature of employment’ (Central government, state government, PSU or others)
- Under schedule Salary, individuals can now disclose income from retirement benefit accounts maintained in a notified country and claim relief for any taxes paid.
- Taxpayers are given the option to choose between the old tax regime and the new tax regime
- Dividend Income has to be added with a quarterly breakdown for accurate calculation of Interest under Section 234C
- The individual taxpayers who meet the following criteria:
- Make cash deposits above INR 1 Crore with a bank,
- Incur expenses above INR 2 Lakh on foreign travel or,
- Spend above INR 1 Lakh on electricity should also file ITR1
- Condition of the individual having income from salaries, one house property, other income, and having total income up to INR 50 Lakh continues
- Resident individuals owning a single property in joint ownership can also file ITR 1 where the total income is up to INR 50 Lakh.
- Taxpayers should separately disclose the amount of the investment or deposits or payments towards tax saving made from 1 April 2020 until 30th June 2020.
First, add the salary income of the current employer as per Form 16. And then calculate the taxable salary from the previous employer as per salary slips and file your ITR.
Yes. You can file a ‘Belated Return’ after the due date. You can file a belated return before the end of the Assessment Year or before the completion of the assessment whichever is earlier. Late filing fees as per section 234F will also be levied.
Yes, a taxpayer can file ITR 1 even though they have multiple Form 16. A taxpayer may have multiple Form 16 if they changed jobs during the financial year. They get Form 16 from both their current employer and past employer at the end of a financial year.