Keep these 14 documents ready before filing ITR, will benefit
All the necessary documents should be collected before filing Income Tax Return (ITR). This makes filing returns easier. Employed people usually use the ITR-1 or ITR-2 form to file it. Both these forms are available on the e-filing website. Apart from this, information like PAN, Aadhaar, income tax details, etc. are pre-filled in the ITR-1 available on the online platform.
It is necessary to mix them with the documents that are with you. Even if you are filing ITR through Excel Utility, you can still download a pre-filmed XML file. It can be imported into Excel Utility. The last date to file ITR for the financial year 2019-20 is 30 November 2020. Come, let’s see all the documents that you should gather before filing ITR.
If you are employed, then it is one of the most important documents to file ITR. Abhishek Soni, CEO of the tax filing company Tax2Win.in, says that Form-16 is a TDS certificate. Companies issue it to their employees. It certifies TDS (tax deducted at source) deducted from the salary of the employee. It also shows that the institute has deducted TDS and submitted it to the government.
This form has two parts. Part A and Part B. Part A contains a brief description of the institution’s TAN, its an employee’s PAN, address, assessment year, employment period, and TDS submitted to the government. Part B of Form 16 contains the break-up of salary, claimed deduction, total taxable income, and details of tax deducted from salary.
The institute must issue Form 16. Apart from this, even if the job changes in the middle of the year, the company has to issue Form-16. Form-16 helps in filing Income Tax Return (ITR). It is used as proof of income.
Before getting Form-16, it should be checked that your PAN is entered into it. If there is a disturbance in it, then it must be brought to the notice of the institute. Your institution will fix this and issue a revised form again.
2. Interest Certificate from Bank and Post Office
In this year’s ITR forms, taxpayers also have to tell the source of their interest income. For example, they have to provide interest income earned from a savings account, fixed deposit, or any other source. Generally, interest income from a bank account, FD is taxable. However, under Section 80 TTA, interest income of up to 10 thousand rupees can be claimed. The same limit is 50 thousand rupees for senior citizens.
The interest certificate contains information about how much interest has been received on your savings account. By taking an interest certificate for the financial year 2019-20, it will be beneficial that you will know how much interest the bank has paid during this period.
Soni says that the income tax department will easily detect the disturbances in the claimed deduction. Therefore, you need to be very careful about filing your ITR.
3. Form-16A / Form-16B / Form-C / Form-16D
As per the current tax laws, if the TDS is deducted at a higher interest than the limit prescribed for non-salary fixed deposits, recurring deposits, etc., then your bank will issue you Form-16A. It will have given details of the amount of TDS deducted. On the other hand, if you have sold your property, the buyer will issue you Form-16B. In this, you will have the details of TDS deducted on the amount paid.
Sony says that if you have a rental income, then you should ask the tenant to give Form 16C. It should contain the details of TDS (if any) deducted on the rent to be given to you. As per the existing tax laws, if the monthly rent is more than Rs 50 thousand then the tenant should deduct TDS. 26AS can be checked to see the details of TDS.
Form-16D is a TDS certificate to be issued to contractors or professionals. This needs to be released if a person has paid more than Rs 50 lakh in the financial year 2019-20. This tax is deducted at the time of payment of a commission, brokerage, professional fees.
4. Form 26 A.S.
Form 26AS is your consolidated annual tax statement. It is like your tax passbook. It contains information about all taxes deposited on your PAN. These include:
– TDS deducted from your employer;
TDS deducted from banks;
– TDS deducted on the payment made to you by an institution;
Advance tax deposited on your behalf in the financial year 2019-20;
Self-assessment tax is given by you
Form 26AS can be downloaded from the website of Traces. To download it, you can log into the e-filing website www.incometaxindiaefiling.gov.in. On logging in, click on ‘View 26AS (Tax Credit)’ under the ‘My Account’ tab. The website will take you to the website of Traces where you can download the form.
5. Proof of Tax Savings
You can reduce your tax liability by investing and spending all tax savings made under section 80C, 80CC, and 80CDC (1) during FY 2019-20. Under these three sections, you can get a maximum exemption of Rs 1.5 lakh in income tax.
The options on which tax exemption is granted under section 80C are as follows:
Employee Provident Fund (EPF)
Public Provident Fund (PPF)
Investments in ELSS Scheme of Mutual Funds
-Life insurance premiums
National Pension System (NPS) etc.
Apart from these investments, there are many expenses on which tax benefit is available under section 80C. Repayment of the principal amount of the home loan, tuition fees of children, etc. is included in this.
6. Deduction under section 80D to 80U
Apart from tax saving options under section 80C, there are some expenses on which you can claim tax deduction under various sections of the Income Tax Act.
For example, you can avail deduction under section 80D on the premium paid for health insurance in FY 2019-20. There is a benefit of deduction up to a maximum of Rs 25,000.
7. Statement of home loan from bank / NBFC
If you have taken a home loan from a bank or any other financial institution, do not forget to take a loan statement. This will tell you how much basic money and interest you have paid so far. Tax liability can be reduced from the interest paid on home loans under section 24. Under this, an amount of up to 2 lakh rupees can be claimed.
8. Capital gains
If you have received capital gains from the sale of property / mutual funds etc. then you will have to tell you about this in your ITR.
9. Pre-validation of bank account for ECS refund
The Income Tax Department has announced that from March 1, 2019, it will issue only e-refunds. These refunds will be credited to those bank accounts which are linked with PAN. In such a situation, it is also necessary for you to pre-validate your bank account and link it with PAN.
10. Aadhaar Card
To successfully file your ITR, it is necessary to provide Aadhaar details. According to Section 139AA of the Income Tax Act, it is necessary to provide your Aadhaar details while filing your return of income.
11. Get the details of investing in unlisted shares
If you have invested in shares of an unlisted company, then you will have to give full information while filing ITR-2. Along with the details of the investment, the name and address of the company will also need to be given.
12. Collect bank account details
While filing ITR, you also have to tell you about all your bank accounts.
13. Update bank and PPF account passbook
Do not forget to update the passbook of your bank / PPF / savings account. Interest on PPF is beyond the scope of the tax. But, it has to be reported in the ITR.
14. Salary slip
The employee will also have to tell about house rent allowance, transport allowance, etc. They are taxable. Their details are given in the salary slip.