A Simple 10-Point Guide for First-Time Income Tax Return Filers
Filing your income tax return (ITR) for the first time can seem daunting, even with modern e-filing. This straightforward checklist will guide you through the process, helping you understand who needs to file, which form to use, what documents to have ready, and the deadlines to avoid penalties.
1. Who Needs to File?
You must file an ITR if your annual income exceeds the taxable threshold. You also need to file if you meet certain financial conditions, such as:
- Holding assets in India or abroad.
- Having combined bank deposits over ₹50 lakh.
- Maintaining savings/current account balances above ₹1 crore.
- Paying electricity bills over ₹1 lakh a year.
- Spending more than ₹2 lakh on foreign travel.
- Investing in markets or employee stock ownership plans (ESOPs).
- Having sales worth more than ₹60 lakh in a year.
2. Understanding Taxable Income
Your taxable income is your total earnings from all sources (salary, FD interest, shares, etc.) minus any allowed deductions under the Income Tax Act. These deductions can include investments in PPF, NPS, life insurance, home loan interest, or rent paid.
3. Old vs. New Tax Regime
Choosing between the old and new tax regimes depends on your income and eligible deductions. The old regime allows for more deductions, while the new one offers lower tax rates with fewer exemptions. Use an online tax calculator or consult a professional to see which option reduces your tax liability.
4. The Filing Deadline
The last date to file your ITR for FY 2024-25 (AY 2025-26) without a penalty is September 15, 2025. You can file a belated return until December 31, 2025, but this will result in a penalty of ₹1,000 to ₹10,000, depending on your income and the delay.
5. Documents Required
Before you start, gather these essential documents:
- Form 16 from your employer(s).
- Your PAN and Aadhaar (they must be linked).
- Proofs of investments.
- Your home loan interest certificate.
- Insurance premium receipts.
6. What is Form 16?
Form 16 is a crucial TDS (Tax Deducted at Source) certificate provided by your employer. It details your salary, deductions, and exemptions, which are all necessary for filing your return.
7. What is Form 26AS?
Form 26AS is a statement that summarizes all the income on which tax has been deducted. It’s essential for cross-checking that the TDS credits reflected in your return match what’s on record with the tax department.
8. What is the Annual Information Statement (AIS)?
The AIS provides a comprehensive list of your financial transactions, including interest income, dividends, and securities trades. Much of this information is now auto-filled in your ITR form, making the process faster.
9. E-verification is Mandatory
After filing, you must e-verify your return within 30 days. Skipping this step makes your return invalid and can delay any potential refunds. Verification can be done easily using your Aadhaar OTP, net banking, or an EVC (Electronic Verification Code).
10. Selecting the Correct ITR Form
Choosing the right form is key. Here are the most common options for individuals:
- ITR-1 (Sahaj): For income from salary, one house property, and other sources (e.g., interest).
- ITR-2: For individuals/HUFs without business or professional income.
- ITR-3: For individuals/HUFs with business or professional income.
- ITR-4 (Sugam): For presumptive income from a business or profession.
By preparing properly—knowing the rules, collecting your documents, and choosing the right form—your first ITR filing can be a smooth and penalty-free experience.(Editing by Suresh)