eFiling IT Returns AY 2020-21

 

This blog will help you to file own IT returns online with ITR-1 form for Assessment Year 2020-21 (Financial Year 2019-20).

Last Date: 30 November 2020. Advised to file income tax by September to get ITR processed quickly.

ITR-1 form is applicable if you have income from following sources:

• Salary
• One House property rent / loan
• Other Sources (Interest on saving bank account / FD etc)
• Agriculture income less than Rs 5000
• Income less than 50 Lac

Prerequisites for e-filing

• Form 16
• Form 26AS (refer Step 4 below)
• Interest from saving bank account / FD
• Any investment that is not declared with company or not reflected in Form 16

Follow below steps to e-file your IT Returns (click on pictures to enlarge)

Step 1 – Get Form 16 from your employer

Step 2 – Register yourself at site https://www.incometaxindiaefiling.gov.in/home

Step 3 – Login on site

User ID is your PAN

Step 4 – Download From 26AS
Follow link My Account --> View Form 26AS (Tax Credit), you will be redirected to TRACES site. Download form 26AS for current Assessment year.

Step 5 – e-File ITR-1
Follow link e-File --> Income Tax Return.
Select current Assessment Year and ITR form as ITR-1 and Submission mode as Prepare and Submit Online.

Select active back accounts from last year submission.

Step 6 – Fill Part A General Information
Personal information will be pre-filled. Validate and modify information.
Nature of employment: Others (for Private sector)
Filed u/s: 139(1)-On or before due date (if you file before last date)

Are you filing return of income under seventh provision to section 139(1): No

Step 7 – Fill Schedule 80D

Take 80D details from Form 16, 

Seperate medical premium amount for self / your family and your parents and enter. (look at your salary slip to get exact distribution of premium between self family and parents)

Step 8 – Computation of Income Tax
Add Salary/ Pension Details from Form 16
Professional tax: 2500

Type of House Property: Select 'Self Occupied' for property if you are residing. Select 'Let Out' for rented property and provide rent details.
Interest payable on borrowed capital: Enter from Form 16. Applicable for home loan interest. (max limit 2,00,000 for 'Self Occupied' property)
Income from Other Sources: Not available on Form 16
Enter interest earned from all saving bank accounts + interest from all FDs

Deductions

If you have invested after 1 April 2020 to 31 July 2020 select YES or select NO

80C: Investments - enter from Form 16 section 80C (max limit 1,50,000)
In case investments are not declared with employer, enter actual amount invested.

80D: Health Insurance Premium - This will be auto calculated from 80D Tab

80G: Charity Donations - Auto calculated from Donations-80G tab
80TTA: enter interest earned from all saving bank accounts (excluding interest on FD. Max limit 10,000)
80TTB: For senior citizons only - enter interest earned from all saving bank accounts (Max limit 50,000)

Exempt Income For reporting Purpose:  Enter tax exempted income like Dividends form shares, PPF Interest  etc.

Computation of Tax Payable will happen automatically. Do not change anything here.

Step 9 – Verify Tax Details
Details of Tax deducted at source from Salary will be auto populated. Tax deducted must match with Form 26AS. If not matching them enter details from Form 26AS.

Step 10 – Verify Taxes Paid
Make sure Amount Payable is 0.
You can have Refund in case extra tax is deducted by employer

In case Total Amount Payable is more than 0, then cross verify all amounts entered from Form 16.
If everything is correct, pay remaining taxes by 'e-Pay Tax' action front of Amount Payable OR e-Pay Tax link on http://www.incometaxindiaefiling.gov.in/home. You will be redirected to NSDL website.

Select Challan No. 280 to make tax payment. After making payment BSR code and Challan number will be generated. Enter these details in Taxes Details tab Advance Tax and Self Assessment Tax section. Total Payable amount will become 0 now.

Step 11 – Verify all Bank account details

Select at least 1 account for refund

Step 12 – Verification and Preview
Make sure Total Tax Payable is 0 before you Submit.
Verify name / PAN Number. My Capacity as 'Self' for IT return. 
Enter Place details
Select I would like to e-Verify option and Preview & Submit.

Step 13 – eVerify and Submit
Preview all details and Submit.
OTP will be sent on mobile linked to Aadhaar number. Enter OTP and Submit.
If you have selected EVC option. Enter EVC generated from Bank ATM or verify from online banking.

Step 14 – Acknowledgement

You are Done! You will get Return successfully eVerified screen. No further action required.

You will get acknowledgement email with attachment.

Password: Enter your PAN (in small letters) and Date of Birth or Incorporation (in ddmmyyyy format)

Do NOT send this Acknowledgement to CPC Bengaluru.

Please post your comments to improve this blog. You can also reach me at mihir.sdoshi@gmail.com.

Learn more on investing at Finology.

Thanks,
Mihir

Tax Regime selection guide. New or Old Tax Regime ?

Budget 2020 has introduced new tax regime for FY 2020-21 for individual tax payer. The new tax has lower tax slabs but most of deductions cannot be availed. Individual can chose between old or low tax regime for FY21 only once. This blog will help you to make smart selection.

Old Regime Tax Rate FY21

Upto 2,50,000 Nil

From 2,50,000 to 5,00,000 5%

From 5,00,000 to 10,00,000 20%

From 10,00,000 and above 30%

New Regime Tax Rate FY21

Upto 2,50,000 Nil

From 2,50,000 to 5,00,000 5%

From 5,00,001 to 7,50,000 10%

From 7,50,001 to 10,00,000 15%

From 10,00,001 to 12,50,000 20%

From 12,50,001 to 15,00,000 25%

Above 15,00,000 30%

Below Deductions will NOT be allowed in New Tax Regime:

• LTA - Leave travel concession u/s. 10(5)
• HRA- House rent allowance u/s. 10(13A)
• Standard deduction of Rs. 50,000/- , 
• Deduction of employment/professional tax u/s. 16 Rs 2,400/-
• Interest on borrowed capital for self-occupied (upto Rs 2,00,000) or vacant property
• Exemption in respect of free food and beverages through vouchers
• Any deduction under chapter VIA like section 80C Rs 1,50,000, and 80CCC, 80CCD, 80D, 80DD, 80DDB, 80E, 80EE, 80EEA ,80G, 80GG, 80GGA, 80GGC

Below Deductions will be allowed in New Tax Regime:

• Contribution by employer to National Pension Scheme u/s 80 CCD

Let us understand by example

Example 1

Individual tax payer below age 60 having 9 lac salary makes no 80C investement

Tax with Old Tax regime: Rs 79,061 (considering standard deduction 50000 + Prof Tax 2400 + 80C PF 30000)

Tax with new Tax regime: Rs 62,400

Individual must select New Tax regime as benifit is Rs 16,661

Example 2

Individual tax payer below age 60 having 9 lac salary makes 80C investement of 150000.

Tax with Old Tax regime: Rs 54,101 (considering standard deduction 50000 + Prof Tax 2400 + 80C 150000)

Tax with new Tax regime: Rs 62,400

Individual must select Old Tax regime as benifit is Rs 8,299

Example 3

Individual tax payer below age 60 having 15 lac salary makes 80C investement of 150000 with no home loan.

Tax with Old Tax regime: Rs 2,09,851 (considering standard deduction 50000 + Prof Tax 2400 + 80C 150000)

Tax with new Tax regime: Rs 1,95,400

Individual must select New Tax regime as benifit is Rs 14,851

Example 4

Individual tax payer below age 60 having 15 lac salary makes 80C investement of 150000 with home loan.

Tax with Old Tax regime: Rs 1,47,451 (considering standard deduction 50000 + Prof Tax 2400 + 80C 150000 + Home loan interest 2,00,000)

Tax with new Tax regime: Rs 1,95,400

Individual must select Old Tax regime as benifit is Rs 47,549

From above example it must be clear that in case you have amount to invest for 80C, mediclaim and have home loan, Old Tax regime is beneficial.

To make claer selection 

• Know your salary
• Calculate all possible deductions
• Go to online tax regime calculators with these figures 
• Find you tax with old and new tax regimes
• Make a Tax regime selection between Old or New.

Hope this blog has enabled you to make smart Tax regime selection. Please post your comments to improve this blog. You can also reach me at mihir.sdoshi@gmail.com.
Learn more on investing at Finology.

Thanks
Mihir