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Business Standard
29-05-2025
- Business
- Business Standard
Filing Income Tax return for the first time? Here's a step-by-step guide
Filing your Income Tax Return (ITR) for the first time can seem daunting but it's a simple process. The Income-Tax Department India has made electronic filing user-friendly. Here's a step-by-step guide to help first-time filers. Who needs to file an ITR? Even if your annual income is below the taxable limit, you need to file ITR in certain situations: If you have deposited more than Rs 1 crore in a bank account. If you have incurred expenses exceeding Rs 2 lakh on foreign travel. If your electricity consumption is more than Rs 1 lakh in a year. These criteria are outlined by the department to ensure compliance and transparency in financial transactions. Should you file an ITR even if you are below tax limit? 'Not filing an ITR even if you're earning below the taxable threshold is a lost advantage,' said Vishwanathan Iyer, senior associate professor of finance and accounting at Great Lakes Institute of Management, Chennai. 'It's no longer just a compliance measure, it's essential to establishing financial credibility and showing foresight,' said Amit Bansal, partner at Singhania & Co. 'Filing an ITR helps establish a financial record with the government and builds credibility with financial institutions. In today's digitised economy, a consistent ITR history may serve as a valuable asset in the long run,' he said. Documents needed to file ITR Before you begin, gather the following documents: Also Read PAN and Aadhaar cards Form 16 (provided by your employer) Bank account details Investment proof (for deductions under sections like 80C, 80D) Interest certificates from banks or post offices Step-by-step guide of filing ITR 1. Register on the e-filing portal Visit the Income Tax e-Filing portal: Click on 'Register' and select 'Individual'. Enter your PAN, which will serve as your User ID. Provide the necessary details and complete the registration process. 2. Log in to your account Use your PAN as the user ID and the password you set during registration to log in. Complete the captcha verification. 3. Select 'File Income Tax Return' Go to the 'e-File' menu and click on 'File Income Tax Return'. Choose the appropriate assessment year (e.g., 2025-26 for the financial year 2024-25). Select 'Online' as the mode of filing. 4. Choose the correct ITR form For most salaried individuals, ITR-1 (Sahaj) is applicable. If you have income from multiple sources, such as capital gains, consider ITR-2 or ITR-3 5. Fill in the required details Personal information (name, address, contact details). Income details from Form 16 and other sources. Deductions under various sections (e.g., 80C, 80D). Bank account details for refunds. Verify all the information entered. Click on 'Preview and Submit' to review the summary. After review, click 'Submit'. How to verify your ITR After submission, you must verify your return. You can do this: Electronically via Aadhaar OTP. Through internet banking. By sending a signed physical copy of ITR-V to the Centralized Processing Centre (CPC) in Bengaluru.
Business Standard
29-05-2025
- Business
- Business Standard
It's time to get Form 16 from your employer, and what to do if it's missing
Salaried Indians have started receiving Form 16, a document employers provide to help in filing Income Tax returns (ITR). Here's when you should get the document. According to the Central Board of Direct Taxes (CBDT) under Rule 31(3) of Income Tax Rules, 1962, salaried employees should receive Form 16 by June 15. Employers are required to furnish Form 16 within 15 days after filing the fourth quarter TDS return (Form 24Q), which is due on May 31. This means the last date to issue Form 16 is June 15, as per CBDT norms. What is Form 16? Form 16 is a certificate that organisations give to their salaried employees. It is a summary of the salary paid and tax deducted at source in a financial year. It has two parts: Can you file ITR without Form 16? Yes, it is possible to file your tax return even if you haven't received Form 16. Taxpayers can use salary slips, Form 26AS, the Annual Information Statement (AIS), and bank statements as alternatives. 'Taxpayers should use salary slips and compare them with Form 26AS and AIS data. If all three are consistent, one can proceed with ITR filing even without Form 16,' said Ritika Nayyar, partner, Singhania & Co. What if there's a mismatch? Sometimes, the figures in Form 16 may not match what's reflected in the income tax portal. This can delay return filing. 'If there is a mismatch between Form 16 and AIS, taxpayers should reconcile using payslips and seek correction from the employer, if required,' said Sandeep Bhalla, partner at Dhruva Advisors. For FY25 (assessment year 2025-26), the last date to file ITR has been extended to September 15. Filing after this date may attract penalties.
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Business Standard
21-05-2025
- Business
- Business Standard
Do NRIs have to file tax returns in India: What's the rule and process
It is the time to file Income Tax returns (ITR) and many non-resident Indians (NRIs) are likely asking: Do they need to do so in India? While the process is simple, experts say NRIs need to carefully give details about their earnings. Do NRIs need to pay income tax in India? 'An NRI is liable to pay tax in India only on the income earned or received in India. This includes rent from Indian property, interest on Non-Resident Ordinary (NRO) accounts, which is savings or current account in Indian Rupees for NRIs in India, or capital gains from Indian assets,' said S R Patnaik, partner and head of taxation at law firm Cyril Amarchand Mangaldas. Who is considered as NRI? According to the Income-Tax Department, an individual's residential status is the first factor in determining tax liability. If you've spent less than 182 days in India in a financial year, you're typically considered a non-resident — and taxed accordingly. How is filing taxes different for NRIs? 'Resident individuals are taxed on global income and can use ITR-1 (Sahaj) for simple income sources. NRIs, however, must use ITR-2 if they don't have business income, or ITR-3 if they do,' Patnaik explained. Common mistakes by NRIs in ITR filing 'NRIs often misclassify their residential status or forget to update banks and mutual funds about the change,' said Amit Bansal, partner at Singhania & Co, a global legal consultancy firm. Also Read 'They also tend to use the wrong ITR form or miss reporting Indian income such as interest earned in NRO accounts.' Bansal advised NRIs to maintain travel records, inform Income Tax Department promptly, and consult a professional to ensure correct classification and filing. Foreign income and reporting: What's mandatory? 'If you're an NRI for tax purposes, your foreign income is not taxable in India,' Patnaik said. 'Also, unlike residents, NRIs are not mandated to disclose foreign bank accounts or assets under Schedule FA. However, they may do so voluntarily.' According to the Central Board of Direct Taxes, mandatory foreign asset disclosure applies only to individuals classified as residents under the Income Tax Act, especially those falling under the Resident but Not Ordinarily Resident (RNOR) category. ALSO READ | No major policy shifts for NRI tax filing for AY 2025–26 The CBDT has released the ITR forms applicable for Assessment Year 2025-26. Form ITR-2 has been updated for clarity and no NRI-specific policy changes or exemptions have been introduced, according to the two experts.
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Business Standard
14-05-2025
- Business Standard
Group Train Booking? Only confirmed passengers can board, says IRCTC rules
Indians planning to travel by train in the country are likely wondering if tensions with Pakistan will upset their itinerary. One common concern is whether a group can board a train if only some tickets under a single booking (PNR) are confirmed and others remain on a waiting list. Many travellers have such questions, especially during holidays, and are likely unaware of rules for partially confirmed train tickets. Waitlisted E-ticket holders cannot board 'If some tickets under a group PNR are waitlisted at the time of chart preparation, those passengers are not allowed to board. Their tickets get cancelled automatically,' explains Monika Bhatelia, partner at Singhania & Co. According to Indian Railway Catering and Tourism Corporation (IRCTC) rules, once a final chart is put out, usually about four hours before a train's departure, any passenger whose status is still on the waitlist will not be allowed to board the train. The system will automatically cancel the 'waitlisted ticket' and initiate a refund process. Key distinction: E-tickets vs. Counter tickets Bhatelia said the rules for train tickets: E-Tickets (booked online): Waitlisted passengers cannot travel. Tickets are cancelled automatically. Counter tickets (booked offline): Waitlisted passengers can travel but without any guaranteed seat or berth. They travel as unreserved passengers. This difference is often missed by passengers, especially those booking tickets on behalf of family or colleagues. No room to split or modify a PNR Travellers hoping to modify a booking or split confirmed and waitlisted passengers into separate PNRs after booking are out of luck. 'Once a group booking is made under a single PNR, it can't be modified or split later. The only option is to cancel the waitlisted tickets and rebook,' Bhatelia adds. Passengers should either book tickets in smaller groups or closely monitor travel status until the final chart is released. When travelling with a partially confirmed ticket, only confirmed ticket holders are legally permitted to travel. For the rest, staying updated and planning early remains the best way to ensure a smooth journey.
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Business Standard
09-05-2025
- Business
- Business Standard
Indo-Pak conflict: Your home insurance is of no use, say experts
Operation Sindoor, the military action against Pakistan, has prompted Indians living near the borders to wonder if their home insurance policies will protect them in such conflicts. 'War, invasion; act of foreign enemy hostilities or war-like operations; civil commotion amounting to a popular rising; insurrection, military or usurped power are excluded [from insurance protection],' said Amrish Dubey, senior-vice president, personal lines, Tata AIG General Insurance. 'War' exclusion 'Standard Indian home insurance contracts universally exclude war or war-like operations – whether declared or undeclared,' Dubey said. The clause typically defines war as: 'War, invasion, act of foreign enemy hostilities or war-like operations (whether war is declared or not), civil war, mutiny, civil commotion amounting to a popular rising, military rising, rebellion, revolution, insurrection or military or usurped power.' By defining war so broadly, insurers protect themselves against unpredictable and massive losses that military conflicts entail. Homeowners' options 'In light of the immense potential liabilities and the difficulty in assessing and pricing such risks, homeowners do not currently have the option to extend their policies to cover war-related damages, regardless of escalating tensions or military operations,' said Rohit Jain, managing partner at Singhania & Co, a law firm. Unlike shipping or aviation sectors, residential property remains outside war-risk underwriting. Terrorism, acts of war 'Terrorism can be covered under home insurance policies as an optional add-on,' said Dubey. Terrorism is defined as 'an act or series of acts … use of force or violence … by any person(s) on behalf of or in connection with any organization(s) or government(s) … for political, religious, ideological or similar purposes.' This option is limited as well. 'If damage arises from cross-border strikes involving national armies, insurers will classify it under the war exclusion and deny the claim, maintaining a clear distinction between terrorism and acts of war,' said Adhil Shetty, chief executive officer of 'Political-violence' extension Jain said that a 'small number of insurers' offer limited political-violence or civil-commotion endorsements. To activate these extensions, policyholders must: Lodge the claim and preserve evidence immediately Submit a police FIR when applicable Provide photographs, repair estimates, and original purchase invoices Supply media or government notifications confirming unrest' He added, 'Accuracy and timeliness in documenting the event play a crucial role in the success of such claims.' 'The burden of proof lies with the policyholder,' said Tushar Kumar, advocate, Supreme Court of India. 'Insurers require conclusive evidence, such as engineers' damage assessment reports, authenticated media coverage, and official notifications, to establish that losses directly result from political violence or civil commotion as defined in the policy.' Homeowners in sensitive border areas should review their insurance policies, ask insurers about any available extensions, and maintain records.
