Taxpayers face many hurdles while filing income tax returns. The issues range from which ITR form to fill, how to compute taxable income, which deductions they are eligible for, how and where to file returns, and many others.
To make the process simpler for individuals and for better compliance, the income tax department has taken several measures. The most prominent among these measures is the introduction of pre-filled Income Tax returns form.
The pre-filled form will contain details of salary income, bank interest, TDS details, deductions claimed, and dividends, etc. Earlier these details had to be manually entered.
Finance Minister Ms Sitharaman in her budget speech said that the information will be collected from banks, stock exchanges, mutual funds, EPFO, state registration departments, etc. She further stated that this will not only significantly reduce the time taken to file a tax return but will also ensure the accuracy of reporting income and taxes.
Pre-filled details will be applicable for ITR-1 form and it is only available if you file your tax returns online. The facility will be unavailable if you download it in Excel or Java format, and then fill and upload it online.
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[Read: How To e-File Your Income Tax Returns In Few Easy Steps...]
ITR-1 form, also known as Sahaj form, is to be filled by resident individuals with a total income of not more than Rs 50 lakhs from the following sources:
Though pre-filled, the details are editable, and you can therefore update the data in case of any mismatch. Taxpayers should verify the pre-filled data carefully before submitting it.
To make the filing process taxpayer friendly, the government has also introduced inter-changeability of PAN and Aadhaar. Around 1.2 crore Indians have Aadhaar while the number of PAN was 42 crores of which 23 crore were linked with Aadhaar a month before the March 2019 deadline to link the two.
Therefore, the government has permitted individuals who do not have a PAN to file income tax returns by simply quoting their Aadhaar number; and they can use it wherever they are required to quote PAN.
Apart from these, the new tax filing forms for the assessment year 2019-20 requires detailed disclosures in some cases to check evasion and eliminate loopholes. These are as follows:
Taxpayers should keep in mind not to delay filing tax returns till the last moment. Here are the various benefits of filing income tax returns on time:
[Read: 10 Benefits Of Filing Your I-T Return On-Time]
Being truthful and filing returns on time will help you plan your taxes and investments better and eventually, empower you to make smarter decisions towards your financial independence.
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Author: Divya Grover
This article first appeared on PersonalFN here.
PersonalFN is a Mumbai based personal finance firm offering Financial Planning and Mutual Fund Research services.
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