What are income tax returns?
Income tax return, or ITR, is a process through which a person declares the income earned in a particular financial year and the tax paid on it to the income tax department of India. ITR is filed for each financial year. Depending on the nature and status of a person's income, different ITR forms are prescribed.
You may check out and download various forms at https://www.incometax.gov.in/iec/foportal.² Individuals who receive an annual income above Rs. 2.5 lakhs must file an ITR in the Old Regime and Rs. 4 lakhs in the New Tax Regime4. Failing to adhere to the norms of the income tax department and ITR may attract penalties and legal actions.
Key points to know before filing ITR ²
Income tax return filing can be a time-consuming task. You must be aware of the details to avoid misunderstanding. So, here are things to know before filing income tax returns. Read on to get ITR ready for the upcoming year.
● Know about different modes of ITR filing.
You can file an ITR in any of the four different ways at your convenience. These include:
- Furnish the return details on a paper form
- You can submit returns electronically that contain your digital signature
- You can submit the returns online through an electronic verification code
- You may transmit the return online and then verify it later using the ITR-V form
● E-filing and e-payment are different processes.
E-payment refers to the electronic mode of tax payment. You may use net banking for this purpose. On the other hand, e-filing refers to the electronic process of furnishing a return of income.
● Late ITR filing attracts a penalt.
Under Section 234F of the Income Tax Act of 1961, late submission of income returns attracts a fine. The individual has to pay a late fine of Rs. 5,000 if the due date exceeds. If the annual income of the individual is under Rs. 5 lakhs, a fine of Rs. 1,000 is imposed.
● You can revise the ITR information after submission.
It may happen that you furnish certain wrong details by mistake. In such a case, you can revise the ITR form even after submitting it to the department. Individuals can revise the form until 31st December of the relevant AY (assessment year) or before the assessment's completion, whichever is earlier5. If a taxpayer fails to file their return by December 31, they can submit an updated return (ITR-U) under Section 139(8A) within two years from the end of the relevant assessment year. However, with the changes introduced in Budget 2025, this window has now been extended to four years6,*.
There is no limit to how many revisions can be done.¹
● Keep a copy of the ITR with you.
Yes, it is commonly advised to maintain copies of past ITR. With e-filing, it has become quite easy to maintain a copy of your ITR.
● ITR filing is mandatory even if you have paid taxes in advance and no refund is due
Section 139(1) makes it mandatory for every individual, company, or firm to file an ITR, even if they have paid taxes and no refund is due. ²
The government can only exercise rights on the taxes paid in advance by individuals/firms/companies when they declare the same in the ITR. It is a form of self-assessment by individuals to ascertain their income and the taxes they pay.
● Keep required documents in advance.
Depending on the nature, source, and status of income, different sets of documents have to be submitted. You may check out the documents required from your source of income. Keeping these documents in advance helps you file the ITR without any hassle.
Mistakes to avoid ¹
ITR filing is a lengthy process, so people may make mistakes. Some of the common mistakes that you must avoid while filing an ITR are:
● Be mindful of the form you select
There are different types of forms under ITR. Make sure to download and fill out the correct form. Submitting wrong forms will require revision and may also lead to rejection of the ITR.
● Do not enter the wrong assessment year.
The assessment year is the succeeding year of a financial year. So, check the assessment year twice before submitting the form.
● Revise details before submitting.
Cross-check your personal details and date format (DD/MM/YY) before submitting the form to avoid unnecessary revisions.
● Keeping income/asset secrets can lead to legal actions
Do not hide your foreign or domestic assets and liabilities. In case you missed out on informing about an asset/income, you must revise the form. Hiding income and assets can lead to legal actions and heavy penalties.
● Adhere to the notice from the income tax department.
If you receive a notice from the income tax department, make sure to revert to it with the required actions. Failing to respond to the income tax notice may lead to legal action.
Conclusion
Income tax returns have to be filed each year. So, individuals must be aware of the process in advance to avoid last-minute hustle. Check out your income tax slab and income, and head to pen down the required documents. Collect these before the process begins to have a hassle-free experience. Bear in mind the key points discussed above to avoid unnecessary mistakes in ITR!
FAQs
1. Who should file an ITR?
Taxpayers with an income above Rs. 2.5 lakhs must file an ITR in the Old Regime and Rs. 4 lakhs in the New Tax Regime4 (as per budget 2025)* during the assessment year.
2. What is the assessment year?
Assessment year refers to the preceding year of a financial year. During the assessment year, taxpayers have to file their income tax returns. For the financial year 2024-2025, the assessment year would be 2025.
3. Is there any fine for late ITR filing?
Yes, filing an ITR after the due date attracts a fine of Rs. 5000. Taxpayers with an income below Rs. 5 lakhs per annum have to pay a fine of Rs. 10007.
Sources:
An ISO 9001:2015 
