The income tax returns (ITR) filing season is underway. The last date for filing your returns is July 31, 2019. To be on time with the filing of your returns, it is important to keep handy a few crucial documents needed to file your returns.
Form 16 is an important document needed to file ITR. Issued by your employer, it is a Tax Deducted At Source (TDS) certificate that has details about the income you receive from your employer and the tax deducted on it. The tax department has notified a few changes in Form 16 and has made it more detailed by including pointers on exact information on tax-exempted allowances and tax claims. Usually, an employer provides Form 16 by mid-June every year, but this year because of the changes announced, the date was extended to July 10.
Form 16 is divided into two parts – Part A and Part B. Part A comprises of info about tax deducted at source by the employer, Permanent Account Number (PAN) of the employee, PAN and TAN of the employer. Part B has details about salary break-up like exemption allowances and perquisites.
While filing your income tax returns, you would need to furnish details of all the tax-saving investment done by you in the specified financial year. Keep all your investment proofs that helped you avail tax deductions under Section 80C, 80D and 80E in the financial year 2018-19 ready.
Home Loan Statement
You can claim deduction on interest paid on a home loan under Section 24 of the Income Tax Act. Ensure you collect this important document from the bank you have a taken a loan from. This will have detailed information about the principal amount and interest paid.
While filing income tax returns, it is mandatory for taxpayers to specify interest income earned through fixed deposits or saving bank accounts. Before you file your returns, collect the interest certificate from the bank, however, if you fail to avail it, ensure to get your account passbook updated with the necessary details like the interest earned in the last financial year. Usually, interest earned is taxable, but you can claim an exemption under Section 80TTA for an amount up to Rs. 10,000. If you are a senior citizen, you can claim a tax deduction for an amount up to Rs. 50,000 for interest earned through a savings account and FDs.
You will have to mention capital gains earned from mutual funds investment, sale of the property, equity shares while income tax returns filing. For this, you will have to arrange documents like mutual funds statement and purchase and sale deed of the property. In case you are filing the ITR-2 form, you will be required to mention the PAN and address of the buyer.
Besides the Form 16, you will also be required to keep your salary slips handy as the newly notified ITR-2 forms require you to mention your income’s nature like dearness allowance, house rent allowance (HRA), etc.
Like Form 16, this is also a crucial document for filing your ITR. Form 26AS has all the information that you require to file your returns. Since it is a consolidated tax statement, you can conveniently use it to file ITR in the absence of Form 16. You will find all the important details like TDS deducted by banks, employers or any other your organisation. You can download Form 26AS easily from the income tax website.
From April 1, 2019, the income tax department has made it mandatory for all the taxpayers to provide the Aadhaar number for filing returns. This year’s budget has proposed to use Aadhaar in the absence of PAN for filing returns. In case you don’t have Aadhaar number and you have applied for one, you would be required to mention the enrollment number of the same.
Besides the above documents, keep your bank account details and updated passbooks ready for a successful filing of ITR.
Important Points To Remember While Filing ITR
-As per an Income Tax Department notification, it will only provide e-refunds from March 1, 2019. For this, your PAN and bank accounts are required to be linked. So do remember to pre-validate your bank account and PAN
-Don’t forget to provide details of investment done in unlisted companies while filing ITR-2. You need to follow this even if you have a regular income, but you hold shares of an unlisted company. Get the PAN number of the company along with details of opening shares balance, issuing share price, purchase share price, closing balance etc.
-Do not forget to mention eligible tax deductions. For example, if you are paying the health insurance premium for your parents, claim a deduction for an amount up to Rs. 50,000 as per their age.
The author is CEO, Bankbazaar.com