Income Tax E-filing and its benefits

What is E-Preparation of Income Tax Return?

E-Preparation of IT Return is the process of preparing your Income Tax Return using a software.

The E-Preparation  software can be of 2 types:

A. Manual Calculation:

Those that allow you to enter your Income Tax data but do not calculate the Income Tax & Refund etc. The individual user needs to calculate the above himself/herself

B. Auto Calculation:

Those that take the Income Tax related data that you have entered  to automatically calculate the Income Tax and Refund  using their  inbuilt  tax calculation engine that is updated for current rules

Auto Calculation Software  is more efficient and less prone to calculation errors.

What is E-Filing of Income Tax Return?

E-Filing of IT Returns is the process of electronically submitting your Income Tax Return to the Income Tax Department.

This electronic submission can be done in one of the following ways:

A. Manually :

Where you  take the output of the software in XML or non-XML format , convert to XML in case of the latter and upload it  to the Income Tax Website.

B. Automatically:

Providers that are  Authorized E-Return Intermediaries of ITD,  are integrated with the Income Tax Department and authorized to E-File  your Income Tax Return. Such providers allow you to E-File your return with a click of a button.

XML upload  is tedious and  user may run into issues  for incorrect format or validation  error.

How do I sign my Income Tax Return when I E-File?

An ITR is an important document and the individual to whom it belongs needs to sign it – Manually or Digitally to affirm that (s)he has reviewed it and is the one who is officially submitting the ITR.

An IT Return can be signed in the following ways when it is being E-filed:

A. Digitally :

Use digital signature, in which case no further action is required. An acknowledgment of filing is provided instantly after submission.

B. Without  Digital Signature (paper signature):

You can  E-File without digital signature, in which case ITR-V form is to be physically signed &  filed with the department’s Bengaluru office  .ITR-V is a single page receipt cum verification form that is sent to the assessee via an e-mail from ITD.

Benefits of E-filing ITR

E-filing is easy, fast, and the most reliable and secure method

  • Fast Processing:  The acknowledgment of ITR submission is fast and the refunds are processed faster by the ITD for E-Filed ITRs.
  • More Accurate:  E-Filing software with built-in validations and electronic connectivity to ITD are seamless and help minimize errors.  Paper based filing with self calculations can be prone to error. Also, when any paper based form is transferred to electronic system , there is always a possibility of human error in data entry.
  • No Time place  constraint: You can file anytime, anywhere. E-Filing is available 24 hours a day, seven days a week , so taxpayers may always file at their own convenience.
  • More Secure than Paper based filing: E-filing is safer than paper based filing. With paper based filing your confidential identity information is lying in files and can be passed from person to person in the CA’s office or in ITD’s office.
  • You can easily access and use your data for future returns: Most of the paid E-filing software applications store your data in a secure manner and allow you to access it whenever you are ready to file subsequent returns.
  • It is good for the environment:  E-Filing is environment friendly. You just need to print  no or at most one page instead of multiple copies of multiple pages  that is required in case of paper based filing.

How to select an E-filing Software

AttributeLow EndHigh End
Tax CalculationYou calculate yourself Automatically Calculated
ITR generationPDF file for manual submission in local ITD Office Only or XML Direct transmission* to ITD
Data  Transmission to ITDYou upload XML Automatically transmitted*
Support to end usersNo Support provided or minimal support provided Support Staff can be accessed via email, chat or phone 24*7
SecurityLimited Over 128 Bit SSL to protect your confidential Information
Storage of past ITRNot Provided Provided so that you may import your previous ITRs data

* Provided by ITD Authorized E-Return Intermediary Only

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Pankaj Batra

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  • My Freinds father are Income tax assessee he expired in december 2011 he does filed ITR for A/Y 2011 -2012 . my freind is only one son he recd all assets like Cash ,FDR , and others , he is assesse . what does tax liability for his

    • @Pushpendra
      Your friend would need to file income tax return on behalf of his father for AY 2011-12 and AY 2012-13.

  • Hi,

    Can I pay house rent to my Mother, is it acceptable?. Are signed rental receipts enough for these?

    My mother has a pan card and the house which i stay is on my mother's name. If I show a house rent of 3.21 lakhs per annum, should i file the tax prior to 31 mar. My mother doesn't have any online accounts. Can i use my online account to pay the dues on time or can i pay it using her credit card?. Also , can we show Medical expenses (8000) and LIC premium(4000) under 80C.

    Regards
    Vikas

    • @Vikas
      You can pay house rent to your mother. There is no issue in this. Signed rental receipts (sign on revenue stamps) would be required to claim HRA exemption.

      If you pay 3.21 lakh as house rent to her, she would need to file income tax return. Taxes would need to be paid before 31st March, to avoid any late payment penalty. But before paying tax, you would need to compute actual income tax based on her age and slab rates. If required, please download income tax calculator from this page: http://www.pankajbatra.com/india/income-tax-calculator-india-2010-2011-2012/. She can also avail 80C, 80D etc deductions.

      You can deposit advance tax in bank branches by paying cash/draft and get a challan. Same can also be paid online using netbanking. Credit cards won't be accepted for this payment. Ideally it should be paid from your mother's account. If you are unable to pay from her account, just transfer that amount from her account to yours and pay it online from your account.

  • Hi,

    I went to the bank on 13/03/2012 to pay self assessment tax through challan 280(individual) for Rs. 7500 for ass year 2012-13 , but the bank person said that the income tax site is not allowing the tax to be paid as self assessment tax, they said either pay as advance tax or tax on regular income, when i asked my friends they said you have to pay only as self assessment tax, please tell me from when we can starting paying tax as self assessment tax (code 300 in the challan 280)and not as advance tax (code 100 in the challan 280)or tax on regular income ( code 400 in the challan 280)( and when is the last date, and which site is used for online tax payment and how? please help...........

  • Sir,

    Thank you very much for your quick response.

    I forgot to mention that the Birla Sunlife Ins Policy is a ULIP a I had purchased it in Nov 2004. Since the surrender is after three years the profit that is made is exempt from tax. But in which section is this exempt and under what head do I show this amount.
    Please guide me.

    Jayashree

    • @Jayashree
      If ULIP has been kept for more than three years, profits from it won't be taxable. There is as such no need to declare same in income tax return.

  • Hi Pankaj,

    My father met with one accident in 2009 dec. For the following years he did not do returns. As he was working in railways he did not file his returns 2009- 2010 yr and 2010 and 2011. But fortunately he was getting his salary thru railways and they have paid the income tax (TDS)for the year 2009-2010 and some small diff was there. we are intimated abt the diff. i paid that thru online.
    NOw my question.
    1. I dont have the income details of the year 2010 -2011. should he need to file the returns or he can leave?

    As we have changed the address there is no chance of intimating us abt the excess we need to pay them. if one yr returns filing if we skip will tat be any problem?

    2. I have the income details of this yr. 2011-2012. i will be doing the tax filling within this june along with mine..

    • @Vignesh
      As your father was getting salaries, he would need to file income tax returns.
      If its not done, one may get notice from IT department.

  • Sir, can you please explain about "ADVANCE TAX(100)" , "SELF ASSESSMENT TAX(300) " and "TAX ON REGULAR ASSESSMENT (400) mentioned in Challan 280 , in relation to individual salaried employee having no other income.. Kindly explain about circumstances under which these taxes are applicable to an individual salaried employee having no other income ..
    I guess this will clear the doubts of thousands of salaried individuals who read your blog..

    • @Akash
      Advance tax is tax is paid in advance by estimating the income that will be earned during the year. In case of salaried employees, TDS deduction done by employer takes care of this. But if somebody have extra income also like fixed deposit interest, mutual fund/equity gains etc. he may need to pay advance tax himself by computing extra tax.
      Self assessment tax is pending tax payable. It is the difference between the tax paid and the tax payable. It has to be submitted before income tax return filing.
      In case Advance taxes are not paid on time, there may be interest payable u/s 234C.
      And in case full taxes are not paid by 31st March, interest may also be payable u/s 234B.

  • Sir , I have never e-filed my return.. This time I am considering to e-file the return..
    I need your help in this. I was going through excel ITR form available at incometaxindiaefiling.gov.in , in the TDS SECTION , there is a chart No. 24 about TDS ON INCOME OTHER THAN SALARY . In this chart there is one column about TOTAL TAX DEDUCTED (column no.4) than next to this column there is column no.5 about "AMOUNT OUT OF (4) CLAIMED FOR THIS YEAR "
    I have confusion about this column No.5 .. what to enter here? What do they mean by " AMOUNT OUT OF (4) CLAIMED FOR THIS YEAR "?

    • @Akash
      There may be some taxes paid in this year which are from last year or coming year. It may be applicable on fixed deposit where interest are not paid but commutative in account.

  • Sir,

    I tried paying tax online at this site:
    :https://onlineservices.tin.nsdl.com/etaxnew/tdsnontds.jsp today 21st march and i selected these fields 1. CHALLAN NO./ITNS 280 2.(0021)INCOME-TAX (OTHER THAN COMPANIES) 3.(300)SELF ASSESSMENT TAX and gave the ass year as 2012-13 but the site does not allow be to proceed and the following comment appeared "Assessment Year cannot be greater than the current financial year for the type of payment selected by you" please help have i missed the last date for paying tax , please help sir................

    • Also sir i have calculated i have to pay 7500 rs as tax for as 12-13 when should i pay it , what is the late date for paying this amount if i have to pay it as self assessment tax.

      or is it allowed to paY 7500 RS AS advance tax for ass year 12-13 , is it last date over.

      what is the correct procedure please help and advice.....thank you very much.

    • @Sunitha
      In case income tax payment is made before end of financial year (31st March), it would be taken under Advance Tax category and not as self-assessment tax. After 31st march, it would be assumed as self assessment tax.

  • I am a salaried person with some additional income from Royalty of books of scientific nature which I had authored. I want to claim deduction on the income from Royalty for which I have the required Form 10CCD from the publisher. Kindly, confirm if it is mandatory to submit this form along with the IT Return to claim deduction and if yes, what is the procedure for submission of Form 10CCD in case of an e-filing through the income Tax filing website, https://incometaxindiaefiling.gov.in

    • @Raj
      No document needs to be attached with income tax return forms. In case income tax department have any doubt on your declarations in ITR, they can raise a query later while assessment, at that time you may have to send supporting documents.

  • Sir , my tax amt is Rs. 10723 /- without including TDS of Rs. 3618 made by my company, just now i realized i should have paid the balance as 7105 /- as advance tax by 15 th mar , can i pay online by 31st mar if yes should i pay along with penalty amount,what is the penalty amount i should pay please advice immediately sir.

    other option:-
    if i invest Rs. 8000 in PPF by 31st march can i avoid advance tax and its penalty and pay the remaining tax amt due as self assessment tax.please advice.

    • @geet
      As pending tax amount is less than Rs 10,000, there won't be any interest penalty even if you pay this amount after 31st March. Just make sure its paid before income tax return filing last date (31st July). This amount can be paid as self assessment tax after 31st March.

      If you want to save tax, you can invest into any of the options available under 80C, 80D, 80CCF etc.

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