what is itr filing
Income Tax Return (ITR) is a form you submit to the Income Tax Department to report your annual income, taxes paid, and any refunds due to you
Think of it as a self-declaration of your financial year’s earnings. Even if your tax is already deducted (TDS) by your employer, you still need to file an ITR to “settle the accounts” with the government
Why should you file it?
- Claim Refunds: If you paid more tax than required (e.g., through TDS), filing an ITR is the only way to get that money back into your bank account
- Legal Requirement: It is mandatory if your total income exceeds the basic exemption limit (₹2.5L to ₹4lakh depending on the regime)
- Loan & Visa Approval: Banks usually ask for the last 3 years of ITR for home or car loans. It also serves as standard proof of income for visa applications
- Carry Forward Losses: If you have a loss in the stock market or business, you can only carry it forward to offset future profits if you file your return on time
The Process in Simple Steps:
- Step 1: Gather documents like your PAN, Aadhaar, and Form 16 (from your employer)
- Step 2: Choose the correct form (e.g., ITR-1 for salaried individuals)
- Step 3: File it online via the Income Tax e-Filing portal.
- Step 4: E-verify your return using Aadhaar OTP to complete the process. Without verification, your ITR is considered invalid