How to file your tax returns electronically…..Bindisha Sarang
Get set to go online with your returns because that is the way forward
Get set to go online with your returns because that is the way forward
While it has become mandatory for certain individuals to file their tax electronically, if you are not in that category already, you better get set to go online with your returns because that is the way forward. Last year, 16 million used the e-filing route, says Saakar Yadav, director, Myitreturn.com, an e-filing portal. This year the number is expected to go up by 30% to about 25 million, says Yadav.
Filing online
Filling the form: Once youve decided on the portal and done the registration, the documents you would have already assembled would come in handy.
While the form is standardized across the portals different portals have a slightly different approach. For instance, Taxsmile.com and Myitreturn.com ask for some simple income and investment related questions; Taxspanner.com and Cleartax.in allow you to email or upload your Form 16 and other relevant documents and fills the data on your behalf. Other portals may ask you to fill the relevant details step by step with online assistance through demo videos, user guides and online chat help.
One of the most important steps in the e-filing process is previewing the form. There is a good possibility that youve made typing errors and this will allow you to make the necessary changes. In fact, some portals prompt you if they detect a possible error.
Who needs to e-file?
Its compulsory for companies to file their returns online. Says Ankur Sharma, CEO, Taxspanner.com, an e-filing portal, For fiscal year 2011-2012, the income-tax department has made it compulsory for individuals with a total income of above Rs. 10 lakh to e-file their returns. Also, it is mandatory for individuals holding accounts of assets abroad. Since the definition of assets is broad, even if you have a savings account abroad opened a few years back, you will have to take the online route to file your returns.
Which portal to choose?
Your choice matrix spans the I-T departments own portal and stand-alone tax filing portals such as Taxspanner.com, Taxsmile.com, Myitreturn.com and Taxyogi.com, to name a few. Currently, there are at least 25 portals in this space. Even brokerage portals such as ICICIDirect.com offer this service to their customers. Many larger banks and financial planning websites such as Perfios.com also offer this service. Some portals, also offer value-added services such as refund tracking. Choose a reputed portal that is approved by the I-T department.
Submitting the form
Before you submit the form, you will have to pay the portal a fee for their services, it would depend upon the type of package you choose and the value-added services you have opted for. If youve done Internet banking or shopped online using a credit card, this part is easy for you. Once your payment goes through, you will get an ITR form in a digital format (XML file) from the portal. You will have to upload this on the income-tax departments website .
Take a printout of the acknowledgement receipt (ITR Form-V). You can also download the form before you take the print. Sharma says, You will need to sign ITR-V and post it to the income-tax department in Bangalore within 120 days of e-filing. Once you receive a confirmation from the department, your e-filing is complete. Keep in mind that the income-tax department accepts ITR-V only via normal and speed post and does not accept couriers. Alternatively, you could sign the acknowledgement online using a digital signature.
Yadav says, By next year, you wont need to send a physical ITR-V form to the Bangalore office. The income-tax department has planned an initiative wherein you will receive a one-time PIN (personal identification number) via email or on your cellphone and you can use this PIN as a proof for ITR-V online.
Which package is for you?
Every portal offers different types of packages or products based on your e-filing needs. The basic package is suitable for salaried individuals and pensioners, who have their salary as the only source of income; in other words, those who need to file ITR1 and ITR2.
If you want value-added services such as year-round service and review of your returns filed by an expert, you will need the advanced package. Some portals offer a separate package for self-employed individuals, while others have special packages for professionals such as doctors and lawyers. The professional package comes with help in preparing you books of accounts, profit and loss statement and the like. Taking into account the e-filing season, many portals have special offers running. Says Archit Gupta, co-founder, Cleartax.in, We are currently offering free e-filing for women; this offer is open till 26 July.
Many portals have special packages for non-resident Indians as well. Some portals also offer free e-filing for certain category of individuals. For instance, Myitreturn.coms Yadav says, As per the income-tax department, those earning a total income up to Rs. 5 lakh need not file their returns. But its a good practice to do it. So we are offering such individuals free e-filing service.