Simplifying Tax Filing: A Step-by-Step Guide for First-Time Filers

Filing income tax for the first time might seem daunting, but with this guide, you’ll find it straightforward. Here’s how to get started

Digital Nari

9/23/20241 min read

1. Understand If You Need to File a Return

Under the Income Tax Act, 1961, individuals must file income tax returns if their total income exceeds the basic exemption limit:

  • ₹2.5 lakh for individuals below 60 years

  • ₹3 lakh for senior citizens (60-80 years)

  • ₹5 lakh for super senior citizens (80+ years)

Additionally, individuals earning through foreign assets, freelancers, or those receiving income from dividends or property must file returns.

2. Gather Necessary Documents

Having the right documents ensures a smooth filing process:

  • Form 16: Issued by employers, showing salary and tax deducted at source (TDS).

  • Form 26AS: Available on the Income Tax e-filing portal, it summarizes taxes paid.

  • Investment Proofs: Documents for deductions under Section 80C (e.g., PPF, ELSS), 80D (health insurance), etc.

3. Know Your Taxable Income

Calculate your gross income by adding income from all sources, including salary, interest, rental income, and business profits. Deduct applicable exemptions, such as HRA or Section 10 allowances, to arrive at taxable income.

4. Choose the Correct ITR Form

Selecting the appropriate Income Tax Return (ITR) form is crucial. Common forms include:

  • ITR-1 (Sahaj): For individuals with income from salary, house property, and interest (up to ₹50 lakh).

  • ITR-4 (Sugam): For presumptive income from business or profession.

5. File Your Return Online

Visit the official Income Tax e-Filing portal (www.incometax.gov.in):

  1. Log in using your PAN/Aadhaar credentials.

  2. Pre-fill details using Form 16 or manually input income and deductions.

  3. Verify your return using Aadhaar OTP, bank account, or DSC.

  4. Download the acknowledgment (ITR-V) for your records.

Timely filing helps you avoid penalties under Section 234F and ensures smooth tax refunds.