Filing Income Tax and Income Tax returns are something everyone must know. While there is no denying that this is complicated and usually better off, if left to one’s CA, its important to know the basics. In this article, we’ll show you how the internet has made Individual Taxation a lot easier.
There are two main websites for Income Tax. The first one is the Income Tax India Website which is basically for taxpayers and CA’s. It has all Rules, Notifications, Clarifications, and Circulars pertaining to the Income Tax Act 1961. They also have ITR forms to file your tax returns, challans for tax payment and other relevant information you want to view and download in relation to Income Tax. The second website is the:
First Step: Sign Up and become friends:
To use this website and its services (except for linking of Aadhar with PAN), you will need to create a User ID login. In case you are already filing your Income Tax Return, your CA would have already created an Income Tax login for you. Suppose you do not file your Tax Return, creating a user ID is as easy as opening an email account. Your username will be your PAN, and to login you will require a password and date of birth. This is the whole “set-a-strong-password, verify your contact number, choose a secret question” drill!
Second Step: Explore & Check It Out
The E-Filing Website is to E-File or Upload your Income tax returns. Once you log in, you can check your status, view, and download all the returns or other forms that you have filed (or been filed for you by your CA). You can also check the demands raised by the Income Tax Department, and any actions pending from your end (such as E-Verifying Tax Returns). Once you are logged in the E-Filing Website, you can also view your Tax Credit in Form 26 AS (Read more on this below).
Third Step: Become Comfortable
In order to increase Compliance and encourage assessees to file their Returns, the CBDT (Central Board of Direct Taxes) has made the ITR Forms more concise and easy-to-use. Returns are filed in prescribed ITR Forms, ranging from 1 to 7. A taxpayer can download the ITR Form from the E-Filing Website and fill in her Income Tax Return herself. The ITR Forms ITR-1 and ITR-4 can directly be filled in and submitted on the Website. This makes filing of Returns much easier than it earlier was.
Form 26AS: The Tax Credit Statement
Form 26AS is an annual consolidated tax statement that can be accessed from the income-tax website by all taxpayers using their Permanent Account Number (‘PAN’). If you have paid taxes on your income or tax has been deducted from your income, the Income tax department already has these details in their database.
Form 26AS is important because you can only claim tax credit if the details on this form tally with the details you provided to the IT department. The credit is shown with details of the deductor, the date of booking, the Section, the gross income, and the TDS on it. This form also shows details of Advance Tax paid, Refunds from the IT Department, TDS defaults, and high – value transactions.
For example, professional fees is subject to TDS under section 194J, if the amount likely to be paid during the financial year exceeds Rs. 30,000/- Now let’s consider Ms. A, an architect, and Z Ltd. a Company. Ms. A provides professional services, as an architect, to Z Ltd. and raises an invoice for Rs. 50,000/- When Z Ltd. (the deductor) makes the payment to Ms. A (the deductee), it will deduct TDS u/s 194J at 10%, that is, it will deduct Rs. 5000/- and pay Ms. A Rs. 45,000/-. The Rs. 5000/- deducted, will be deposited with the Revenue Authorities using the appropriate Challan. In addition to depositing the TDS, Z Ltd. will have to file a TDS Return at the end of the Quarter, within the stipulated due date.
Form 26AS is a computer – generated statement showing the tax credit available to a deductee. Once Z Ltd. filed its TDS Return, giving details of the income deducted of Ms. A, this information enters the system and is reflected in the Form 26AS of Ms. A, (the deductee), along with any other TDS that has been deducted on her income. She can then claim the TDS credit when she is filing her own Income Tax Return.
So, there you have it. The E-Filing Portal is not as intimidating as it sound. If it still intimidates, visit and familiarize yourself with the income tax website and whatever information “taxes” you, feel free to ask us and we will be happy to help you.
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Written by Eesha
Eesha is currently pursuing Chartered Accountancy. When she isn’t working or studying, she enjoys music, literature, and writing. You can find some of her writing on her blog.