The process for filing income tax return (ITR) for the assessment year 2023-24 has begun and the Income Tax (I-T) Department has opened its portal for individuals to submit their forms. The process of filing ITR for first-time filers can be a challenging experience. Below is the list of ten things that first-time taxpayers should pay attention to while filing their ITR:

Total taxable income

An individual’s taxable income is the amount of income that is subject to tax after allowable expenses and tax-saving deductions have been calculated against gross income.

Old tax regime/ new tax regime

The most crucial decision when it comes to filing ITR is whether an individual wants to opt for the new tax regime or the old regime. The new tax regime offers lower tax rates, but the old regime allows taxpayers to save tax by claiming deductions and tax benefits.

Form 16

Form 16 is a tax deducted at source (TDS) certificate issued by an employer to salaried individuals. It contains all the salary details that need to be entered while filing income tax returns. This includes information on the deductions claimed, the salary earned, and the exemptions availed.

ITR deadline

Taxpayers must note that the last day for filing income tax returns is 31st July of every financial year.

Form 26AS

It is an important document that contains information on all the income earned on which there has been a TDS. Details provided in Form 16 should be cross-verified with the details given in Form 26AS. The form can be downloaded from the portal and the details get updated when the taxpayer uploads their TDS return statement.

Documents required

The following documents are required when filing the ITR form: bank account details, Form 16, insurance premium payment receipts, PAN card, Home loan interest certificate, and details of Aadhaar card.

Annual Information Statement

The Annual Information Statement (AIS) is a comprehensive summary of a taxpayer’s financial transactions for a financial year. It includes information on interest, dividends, securities transactions, mutual fund transactions, and foreign remittances. When a taxpayer uses the prefill option while filing their income tax return, the information from the AIS is automatically filled in the return form.

Which ITR form to file

Taxpayers must choose between four different categories

ITR-1: This form is for resident individuals who have income from salaries, one house property, and other sources (such as interest and dividends), and whose total income is up to Rs 50 lakh.

ITR-2: This form is for individuals and Hindu Undivided Families (HUFs) who do not have any income from business or profession under any proprietorship.

ITR-3: This form is for individuals and HUFs who have income from a proprietary business or profession.

ITR-4: This form is for individuals and HUFs who have presumptive income from business or profession.

Verification

Verification of returns is a necessary step after the individual files the ITR form. This can be done through both offline and online modes. In the case of the online mode, an individual can complete the process through Aadhaar one-time-password (OTP). The IT department will send an e-verification mail to the taxpayer for confirmation if the verification is completed through electronic mode. For offline verification,  the taxpayer must send a printout of the ITR to Centralised Processing Centre (CPC), IT Department, Bengaluru.

Penalty for not filing returns