Salaried ITR Filing: 2024 Guide & Easy Steps

The process of filing an Income Tax Return (ITR) is a crucial annual obligation for salaried individuals in India. This document aims to provide a detailed, step-by-step guide for the 2024 assessment year, covering essential aspects from understanding the necessity of filing to claiming appropriate deductions and avoiding common errors.

Necessity of ITR Filing for Salaried Employees

The fundamental question arises: is filing an ITR mandatory for all salaried individuals? The answer primarily depends on the individual’s total income for the financial year.

Threshold Limits:

• For individuals below 60 years of age, the basic exemption limit is ₹2.5 Lakh.
• Senior citizens (60-80 years) enjoy a higher threshold of ₹3 Lakh.
• Super senior citizens (above 80 years) have a threshold of ₹5 Lakh.

If the total income exceeds these respective limits, filing an ITR becomes obligatory.

Situational Requirements:

Even if the total income falls below the taxable threshold, certain scenarios necessitate ITR filing:

• Tax Deducted at Source (TDS) Refunds: If TDS has been deducted from salary or other income sources, filing an ITR is the only way to claim a refund.
• Loan and Visa Applications: Financial institutions and embassies often require ITR documents as proof of income for loan and visa approvals.
• Carrying forward Losses: If you incurred losses under heads of income like capital gains or house property, and you want to carry forward these losses to future years.
• Holding Foreign Assets: If you are a resident and an ordinarily resident and hold any assets outside India.
• Deposit exceeding Specified Limit: If you have deposited more than 1 crore rupees in one or more current accounts, or 2 lakh rupees in a savings account.
• Electricity Bill exceeds Specified Limit: If your electricity bill exceeds 1 lakh rupees in a financial year.

Selection of the Appropriate ITR Form

The Income Tax Department has prescribed various ITR forms, each catering to specific income sources and taxpayer categories. For salaried employees, the selection primarily revolves around ITR-1 and ITR-2.

ITR Form Selection Table:

Form	Who Should Use It?
ITR-1 (Sahaj)	Income from salary, one house property, other sources (up to ₹50 Lakh)
ITR-2	Income from salary, capital gains, more than one house property, foreign assets.
ITR-3	Income from business or profession.
ITR-4 (Sugam)	Income from salary, capital gains, more than one house property, and foreign assets.

Note: Individuals with business income must utilize ITR-3 or ITR-4, depending on the nature of their business.

Understanding Form 16: The Foundation of ITR Filing

Form 16 is a crucial document issued by the employer, serving as a certificate of TDS deducted from the employee’s salary. It is essential for accurate ITR filing.

Components of Form 16:

• Part A: This section contains the employer’s and employee’s details, along with a summary of the TDS deducted and deposited with the government.
• Part B: This part provides a detailed breakdown of the employee’s salary, including allowances, perquisites, and deductions claimed under various sections like 80C, 80D, and HRA.

Alternative Documentation:

In situations where Form 16 is unavailable, the following documents can be utilized:

• Salary Slips: These provide a monthly breakdown of the employee’s salary components.
• Bank Statements: These reflect the credit of salary and interest income.
• Form 26AS: This document, downloadable from the Income Tax portal, provides a consolidated statement of TDS deducted from various sources. You can download it from the official Income Tax portal: Income Tax e-Filing.

Step-by-Step Guide to ITR Filing for Salaried Employees

The following steps outline the process of filing an ITR for salaried employees:

Step 1: Document Compilation:

• PAN Card: This is a mandatory identification document.
• Aadhaar Card: Useful for e-verification.
• Form 16 (Part A & B): This provides salary and TDS details.
• Bank Statements: These are required for interest income and other financial transactions.
• Investment Proofs: Documents supporting deductions claimed under various sections, such as PPF, ELSS, and insurance premiums.
• Home Loan Statement: If applicable, for claiming home loan interest deductions.
• Rent Receipts: If applicable, for claiming HRA exemption.

Step 2: Registration on the Income Tax Portal:

• Visit the official Income Tax portal: https://www.incometax.gov.in
• Log in using the PAN as the user ID and the corresponding password.
• In case of first-time users, register using PAN.

Step 3: ITR Form Selection:

• Choose the appropriate ITR form based on the income sources: ITR-1 or ITR-2.

Step 4: Income Detail Input:

• Salary: Enter the gross salary, HRA, and other allowances as specified in Form 16.
• Other Income: Input details of interest income from fixed deposits, savings accounts, and rental income, if applicable.

Step 5: Deduction Claims:

• Claim deductions under relevant sections, such as 80C, 80D, and HRA.

Deduction Limits and Examples:

Deduction Section	Maximum Limit (₹)	Examples
Section 80C	1,50,000	Public Provident Fund (PPF), Equity Linked Savings Scheme (ELSS), National Savings Certificate (NSC), Life Insurance Premium (LIC), Home Loan Principal Repayment, Tuition Fees for Children.
Section 80D	25,000 (Self) / 50,000 (Senior Citizen) / 75,000(Senior Citizen Parents)	Health Insurance Premium for self, spouse, and children. Additional deduction for parents’ health insurance.
HRA Exemption	Varies	Rent paid, subject to specific calculations based on salary and location. Rent receipts are mandatory.
Section 80EEA	1,50,000	Additional deduction for interest paid on home loan for first-time home buyers.
Section 80G	Varies	Public Provident Fund (PPF), Equity Linked Savings Scheme (ELSS), National Savings Certificate (NSC), Life Insurance Premium (LIC), Home Loan Principal Repayment, and Tuition Fees for Children.

Step 6: Tax Calculation and Payment:

• Utilize the tax calculator available on the Income Tax portal to determine the tax liability.
• Pay the outstanding tax, if any, through net banking or UPI.

Step 7: ITR E-Verification:

• E-verify the ITR using methods like Aadhaar OTP or EVC through net banking for instant verification.
• Alternatively, send a signed copy of ITR-V to CPC Bengaluru for physical verification.

Tax Deductions Available for Salaried Employees

Salaried employees can reduce their tax liability by claiming deductions under various sections of the Income Tax Act.

• Section 80C: Investments in PPF, ELSS, LIC, etc.
• Section 80D: Health insurance premiums.
• House Rent Allowance (HRA) Exemption: Rent paid, with conditions.
• Standard Deduction: ₹50,000 from gross salary.
• Section 80EEA: Additional home loan interest deduction.
• Section 80G: Donations to charitable institutions.

Common Errors and Preventive Measures

Avoiding common mistakes is crucial for accurate ITR filing and preventing notices from the Income Tax Department.

Errors:

• Non-Disclosure of Interest Income: Failing to report interest income from savings accounts and fixed deposits.
• Incorrect HRA Claims: Claiming HRA without valid rent receipts.
• Mismatch with Form 26AS: Discrepancies between the TDS reported in Form 16 and Form 26AS.
• Neglecting ITR Verification: Filing an ITR without completing the verification process.
• Incorrect Personal Information: Providing wrong PAN, Aadhaar, or bank details.
• Missing Deadlines: Failing to file ITR within the stipulated time.

Preventive Measures:

• Ensure accurate reporting of all income sources.
• Maintain proper documentation for all deductions claimed.
• Cross-verify TDS details with Form 26AS.
• Complete the ITR verification process promptly.
• Double-check all personal Data.
• File ITR within the given Deadline.

External Sources and References:

• Income Tax India Portal: https://www.incometax.gov.in
• RBI Tax Guidelines: https://www.rbi.org.in
• ClearTax ITR Guide: ClearTax ITR Guide
• Tax Information Network of India: TIN NSDL

Conclusion

In conclusion, navigating the complexities of ITR filing for salaried employees in 2024 requires a meticulous approach, encompassing accurate documentation, a thorough understanding of applicable forms and deductions, and adherence to the prescribed procedures. By following the step-by-step guide outlined, and by diligently avoiding common pitfalls, individuals can ensure compliance with tax regulations, optimize their tax liabilities, and ultimately, safeguard their financial well-being. The importance of staying updated with the latest tax laws and utilizing the resources provided by the Income Tax Department cannot be overstated. Embracing this proactive approach to tax management will not only streamline the filing process but also foster a sense of financial responsibility and peace of mind.

Frequently Asked Questions (FAQs): ITR filing for salaried employees