10 Documents to Keep Ready to File Income Tax Returns
You may now already know how to file income tax returns by logging in to an approved return filing site. However, there is a chance that a mistake may occur when filing the taxes. It is usually safer and better to take care to prevent such errors. The most vital step to take before completing your tax returns is to ensure that you have quick access to all the needed papers.
What Exactly is an Income Tax Return?
The Income Tax Return (ITR) is a paper used to submit data about your income and taxes to the Income Tax Department. Your tax due is computed depending on your income. You or a firm that makes any income over a fiscal year is compelled by law to file a tax return each year. The income might be in the form of a wage, firm earnings, income from real estate, dividends, equity profits, interest, and other forms. Tax returns must be submitted by a certain date. If you fail to meet the deadline, you must pay the penalty.
Documents Needed for Income Tax Return Filing
- PAN Card
It is the first and most vital need if you’re filing a tax return for income. Your identity on the wage tax PAN card should match the name on your ITR. Your PAN is vital for TDS deduction and must be connected to your account in the bank, enabling instant payment of income tax rebates (if any). The Office of Income Tax issues it, and a salaried worker may locate their ITR on their PAN card, Form 16, Form 26AS, Form 12BB, and so on. This will help you learn how to file a tax return with your PAN card.
- Aadhar Card
You must submit your Aadhaar card information while filing returns. This is as per Section 139AA of the Income Tax Law. If you don’t have your Aadhaar card and have requested one, you must include the enrollment ID of your Aadhaar card in your income tax returns. Linking your PAN and Aadhar enables you to confirm your ITR digitally using an OTP. This helps you learn how to file a tax return with your Aadhaar card.
- Account Information
The ITR requires the reporting of all open bank accounts. You must include bank account data, such as your bank’s name, IFSC, account number, and the number of accounts you own, in your income tax return. In addition, one account will be marked as the main account to aid the Income Tax Office in repaying your tax rebate by online transfer to that account. Bank information is utilized to examine your salary reports, high-volume payments, and so forth. These details are freely accessible via a bank passbook, statement, checkbook, net banking account, and so on.
- Form 16
This document holds data on your pay and the amount of TDS taken from you. Part A and Part B of Form 16 are distinct papers. Part-A covers data on the sum of tax taken by the firm throughout the fiscal year, as well as the employer’s PAN and TAN. Part B of the form contains TDS figures such as gross pay breakdown, exempt allowances, extra perks, and so forth. This will help you know how to file a tax return with Form 16.
- Form 26AS
It’s an annual tax report, similar to a tax passbook, that contains data about all the charges you have submitted against your PAN. Among them are:
- TDS is collected by the bank.
- TDS is collected by your employer.
- TDS is collected by other companies from payments made by you.
- You have deposited advance taxes.
- Self-assessment taxation paid by you.
You must ensure that all taxes deducted during the fiscal year are reported against the PAN on Form 26AS. If there is a disparity, you won’t be able to get the tax rebate for the TDS deduction. Hence, you must correct the mismatch by contacting the deductor. This is how to file a tax return with Form 26AS.
- House Loan Statement
You get data such as principal and interest repaid in your loan report. This data is required as proof as well as when completing your ITR. If you have taken a house loan from any financial entity, you must get a record for the previous fiscal year.
- Data About Capital Gains
You will have capital gains or losses if you sell shares, assets, or land. You will require paperwork such as broker records, property sale papers, and so forth.
- Instruments for Tax Savings
If you have been involved in any tax-saving plans, such as tax-saving ELSS, FDs, investment receipts, and so on, you should have the proper documentation available when you submit your taxes.
- Rental Income
If you make money from your home or land, you must show it when you file your insurance claim. Also, if you pay rent, remember to get records from your landlord. Although these papers are not required to be filed with the income tax return, they should be kept secure in case they are needed in the future. In the long run, this will help you understand how to file a tax return with your rental income.
- Foreign Income
You must send papers for any income made in or from a foreign nation during a work deployment or any other portion of the year to your tax expert. Experts will assist you in claiming tax credits and DTAA (Double Tax Avoidance Agreement) benefits. You must obtain paperwork for any overseas income from the firm or vendor.
Conclusion
The documents mentioned above are among the most commonly needed papers to file tax returns. You need to keep track of such papers. And, you must keep them secure throughout the fiscal year to ensure a seamless ITR filing procedure.
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