Important Steps To Take Before Filing Your Income Tax Returns

The deadline for filing your Income Tax Returns for the Financial Year 2017-18 is July 31. It is good to file the returns well in time so that you complete it without any rush or stress. 

Let us have a look at what is to be done before the deadline of July 31st.-

1) Assess if you are supposed to file IT returns by calculating your total income.

If you are earning income and below 60 years old and your income is greater than Rs. 2,50,000, you have to file IT returns.

If you are a senior citizen and your income is greater than Rs. 3,00,000, you have to file IT returns.

If you are a super senior citizen and your income is greater than Rs. 5,00,000, you have to file IT returns.

2) Check if you have invested in PPF and NPS before March 31st of the financial year. It is important to deposit the requisite amount as per financial needs, goals and financial capacity. Check if your bank account is debited on time. If not, you can lose the tax benefits of investing in these products.

3) There are many provisions for deductions in Section 80C, 80CCCC, 80D and 80DDB related to medical insurance, annuity plan, life insurance, school fees etc. You should make sure you have  invested in the right products or purchased the appropriate products for you.

4) File IT returns if they are pending for previous financial year till the end of the assessment year.

5) Submit your Leave Travel Allowance (LTA) claims if applicable. You can claim LTA twice in a block of 4 years. The year block applicable now is  2018-2021.

6) Get all appropriate documentation ready. Get Form 12B from previous employer if applicable. Get the Certificate of Interest and Principal paid on Loans that are eligible for making deductions. Check if Form 16 and Form 26AS are in place and have the correct details. Get the details of all investments made and the interest, dividend, profits and losses made in those investments. Be sure of the ITR that you have to complete and submit.

7) If you have deposited cash in excess of Rs. 2,00,000 during the demonetization phase, you have to account for it in the tax returns document. If you have deposited money in the bank which has not been accounted for during the demonetization phase, you should add it to the taxable income and pay tax on it. If you are not able to provide proper explanation for cash deposited in the bank accounts over the Rs. 2,00,000 limit, report it in the IT returns and pay 60% tax and interest and penalty on it.

8) Report assets that you have acquired abroad. Report all physical and financial assets if your total income is in excess of Rs. 50,00,000.

The last date to file returns for the current financial year – April 2017-March 2018 is July 31, 2018. Prepare in advance and file your returns on time.