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Learn how to file an ITR

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Published On: | Administrator

Every person who earns a taxable income needs to pay his share of tax to the government. Tax is levied not only on a person but also on businesses, Hindu Undivided Families (HUFs), LLPs, firms, an association of persons, and so on.

The residential status of a person makes him liable to pay tax. Every person who is a resident of India needs to pay tax by way of filing an Income Tax Return.

What is an ITR?

An Income Tax Return is a form every taxpayer must submit annually. It is a disclosure of one’s sources of income, exemptions applicable to such income, and deductions made from the income earned by such person.

The income disclosed in an ITR form should further provide how much of it was earned in the form of salary, from house property, the form of profits earned by one’s business, capital gains, dividends, and other miscellaneous sources as well.

Why you need to file an ITR?

It is not mandatory for everyone to file an ITR. Only those persons who earn such income which is more than the basic exemption limit, are liable to file an ITR.

Late filing of ITR attracts penalty. Non Filing of ITR hampers the chances of a person securing a loan or even a visa in the future.

Who should file an ITR?

According to the Income Tax Act, 1961, the following categories of persons and businesses are supposed to file an ITR:

I) A person whose total income is more than Rs. 2.5 lacs,

ii) A senior citizen whose total income is more than Rs. 3 lacs,

iii) A registered company, regardless of the profits/losses made by it,

iv) NRIs who earns any income in India

v) Indian residents who have assets/financial interest entities outside India, and

vi) Anyone who seeks a refund of excess tax paid earlier.

Step-wise process of filing ITR

Step 1: Calculate Income and tax as per the provisions of the Income Tax Act, 1961.

Step 2: The taxpayer should summarize the TDS payable and form 26AS aids in summarizing TDS and tax paid during the year.

Step 3: There are different forms available for different categories of taxpayers. It is important to choose the right Income Tax form.

Step 4: Download the ITR utility offline software such as Excel, Java, or JSON based on your preference. However, Excel and Java are discontinued from the Assessment Year 2020-21 by the Income tax department.

Step 5: File the relevant details in the offline utility.

Step 6: Click on the ‘validate’ button on the right side of the screen.

Step 7: After successful validation, convert the file to XML format by clicking on the button ‘Generate XML’.

Step 8: The XML file is then uploaded to the e-filing portal.


Every taxpayer living in India needs to file an ITR every year to make a disclosure of the sources of his income, exemptions, and deductions. Timely filing of ITR helps one obtain a loan or a visa if needed in the future.

Also, not every person is eligible to file an ITR. Certain categories of persons are specified by the Income Tax Act, 1961 who are liable to file an ITR every year. The process of filing an ITR is not at all cumbersome and with minimal skills, a layman can also understand it.