The Income-Tax Department has implemented a convenient system of pre-filled forms to simplify the process of filing income-tax returns (ITRs). However, it remains crucial to possess the essential documents to authenticate the information provided in the form. While there is no mandatory obligation to upload documents initially, they might be requested in case an assessing officer conducts an investigation.
Taxpayers must ensure to maintain proper organisation of all pertinent documents, keeping them easily accessible. This will facilitate a seamless tax filing process and prevent any oversight of potential deductions or inaccuracies in the ITRs filed.
Form 16 is an official certificate issued by your employer, which serves as proof of tax deducted at source (TDS) from your salary. On the other hand, Form 16A is a certificate provided by the deductor for TDS on income sources other than salary. Additionally, there are specific TDS certificates such as Form 16B for TDS on property sales, Form 16C for TDS on rent, and so on.
To ensure accuracy, carefully review the TDS certificates to confirm that the deducted tax amount aligns with the information recorded in your bank statements and other relevant documents. It is essential to include all TDS certificates when filing your tax return in order to claim credit for the deducted taxes.
Employees need to ensure that Form 16 has a valid digital signature and that both Parts A and B are accurately completed. It is the responsibility of the taxpayer to verify that the TDS certificate has been shared by the employer or any other deductor, and this can be done by downloading it from the TRACES portal.
Interest income certificate
To benefit from exemptions under Sections 80TTA and 80TTB of the Income Tax Act, 1961, it is essential to gather interest certificates from banks and post offices. Any interest amount exceeding ₹10,000 or ₹50,000, depending on the applicable case, is subject to taxation for the taxpayer.
When filing tax returns, it is crucial to disclose all interest incomes and securely retain the interest certificates for precise reporting. It's important to note that starting from FY 2021-22, if the interest earned on Employee Provident Fund (EPF) contributions exceeds ₹2.5 lakh, it becomes taxable.
Form 26AS
Form 26AS is a comprehensive record of tax deducted and deposited by the government against your PAN. It is important for individuals to compare the details mentioned in Form 26AS with their TDS certificates and interest certificates. To obtain Form 26AS, log in to the income tax portal and download it from the TRACES portal.
Verify whether the TDS mentioned in Form 26AS matches the TDS certificates you have received. Additionally, carefully review other financial transactions listed in Form 26AS to ensure their accurate inclusion in your tax return.
Annual Information Statement (AIS)
The Annual Information Statement (AIS) offers a detailed overview of the information present in Form 26AS. All pertinent details from the AIS are automatically populated in the ITR form.
The AIS serves as an extensive record of a taxpayer's financial transactions reported to the Income Tax Department. It is a crucial document to refer to when filing the ITR to ensure its accuracy.
To obtain the AIS, log in to your account on the Income Tax Portal and download it from there. The AIS provides information on TDS, tax collected at source (TCS), 53 specified financial transactions (SFTs), and other taxes paid. If any errors are found in the AIS or if a specific income mentioned in the AIS is not applicable, it should be reported online.
Proof of investments and capital gain earned
Under the old tax regime, individuals have the option to claim deductions against tax-saving investments. These investments should be declared and submitted to employers. However, if they are missed, they can still be claimed on the ITRs.
For eligible charitable donations, it is important to collect receipts or certificates in the form of Form 10BE, which serves as proof for Section 80G deductions.
When filing the ITR, it is necessary to report capital gains from the sale of property, shares, and mutual funds. Maintain records of the purchase cost, sale proceeds, and expenses related to the transactions, such as brokerage fees, stamp duty, and legal fees.
- If you have made investments in shares, ensure you have the details ready, including the date of purchase, face value of shares, and opening and closing balance.
- When filing the ITR, remember to quote your Aadhaar number as it is a mandatory requirement.
- Keep a record of your monthly salary slips, as they provide information on the amount deducted from your salary and deposited into your EPF account.
- Individuals who have a home loan must retain the interest and principal payment statements. The principal amount is eligible for a deduction under Section 80C, while the interest on the home loan qualifies for tax benefits under Section 24.
Wrong filing of the ITR can cost you dearly as it may subject you to both penalty and the possibility of imprisonment. So, verify all details in pre-filled forms before proceeding to file your ITR this year.
