The income tax return (ITR) forms have witnessed lots of changes this year. The resident individual of India is liable to file ITR-1 for FY 2018-19 if his/her total income lies below INR 50 lakh. Not even this, one can use a similar form for return filing if he/she earns income from salary, one house property, residuary income (interest, etc.), and agricultural income up to INR 5,000. While a director of a company and the person holding investments in unlisted equity shares is not liable to file this ITR-1 form this year.

To file the ITR-1 Form, one can use Excel and Java utilities. Besides this, the e-filing is a better option to file the return because the basic information of the taxpayer comes pre-filled in the ITR-1 form generated from the e-filing software.

Here we are providing the step by step process which will make it quicker and easier to file the return in Form ITR-1.

Step 1: Visit www.incometaxindiaefiling.gov.in and log in using your PAN and password.
Step 2: Go to e-file on the menu bar and select Income Tax Forms
Step 3: Fill the mandatory details on the landing page and proceed further clicking ‘Continue’
Step 4: On the landing page, you will find 7 tabs.

Instructions: This tab provides general instructions to file an income tax return by a taxpayer.

Part-A (General Information): This section requires to fill with personal information of the taxpayer likewise name, address, Aadhaar Number, mobile and email address, etc. However, in the case of filing from an e-filing account, this information comes pre-filled which can be edited by the taxpayer.

Computation of Income and Tax: in this tab, the details of salary from different income sources and claimed tax-saving deductions get auto-filled. Among salary options, it can include salary from income, income from house property, interest income (if TDS is deducted), etc. while the tax liability on such income gets calculated automatically by the portal. Still, the taxpayer suggested cross-checking the information just for once.

The detailed reporting of income in this tab is explained in the given below illustrations.

Illustration 1: Mention Salary Income in ITR-1

Suppose the gross salary of Mr A for FY 2018-19 is INR 6 lakh and INR 50,000 HRA is an exempted amount. Against last year, when there was need of only mentioning net taxable salary, this year every individual has to report details like gross salary, exempt allowances, prerequisites and profits in lieu of salary. The calculated figure now further be reduced with the deductions available under section 16 (for example, standard deduction, etc.)

However, all the details get auto-populated in the e-filing ITR-1 for ay 2019-20 still one must cross-check with the information provided in the documents such as Form-16, salary slips and bank statements.

Illustration 2: Mentioning Income Details from house property in ITR-1

Apart from reporting income from salary, the details of income from house property also required to be mentioned in the ITR-1. It will include information on different types of house property, income from house property which is fetched directly from last year's ITR and Form 26AS. The format assesses will follow to mention details of income from property in ITR is illustrated below.

Suppose Mr A has earned a total income of INR 12 lakh from rent and paid a house tax of INR 10,000. Also, an interest of INR 1.5 lakh paid by the taxpayer on housing loan along with receiving of arrears of rent of INR 1 lakh related to previous FY, i.e., FY 2017-18.

While mentioning details of income from house property, the taxpayer must select the type of house property. Earlier, the ITR form provides options to select as a house property were ‘self-occupied’ or ‘let out’ which has been extended in the new ITR-1 with the introduction of a new option ‘deemed let out’ under the category of ‘type of property’.

Until last year, there was a provision if any taxpayer obtained any amount in the form of arrears/unrealized rent, he was not able to file a return in ITR 1. This year with introduced changes in the ITR 1, the tax department allows taxpayers to report the arrears/unrealized rent.

If the taxpayer obtains arrears of rent for the previous period the amount would be taxable

in the receiving year under his head income from house property. However, 30 percent of share of such rental income is exempted from tax consideration. There is no such option of reporting 30 percent of arrears as a deduction in ITR 1 as separately. Therefore, if the taxpayer received any arrears of rent during the year, he should report the taxable part only, likewise arrears of rent less than 30 per cent.

Illustration 3: Mentioning of income from other sources in ITR-1

This category consists of interest income from fixed deposits (TDS Deductible) and interest obtained from the income tax refund of the previous year, which get auto-filled in the ITR 1. In addition to this, the income which a taxpayer remember to report is interest earned from savings accounts in bank/post-office and should claim deduction under section 80TTA or 80TTB as applied.

Mentioning of such incomes can easily be understood from the illustration given below:

Suppose Mr A received interest income of INR 12,000 from saving accounts and INR 60,000 from fixed deposit interest income for FY 2018-19. Along with this, an amount of INR 5,000 is earned by him as an insurance commissioner. Earlier, there was a requirement of reporting the aggregate amount of income taxable under the head of other sources. But not specifying the nature of income taxable under the head 'Income from other sources' has become mandatory from this year.

Along with this, the taxpayers have to further bifurcated source-wise interest income in the new ITR forms such as interest from savings bank deposits, fixed deposit and income-tax refund etc. However, it’s taxpayer’s responsibility of claiming a deduction of up to Rs 10,000 under section 80TTA, in lieu of interest received on the savings bank account, as it’s not auto-populated in the head where taxpayer report the details of interest on savings deposit. Under section 80TTB, the senior citizens are eligible to claim a deduction of up to INR 50,000 for total interest income earned from the bank and /or post office savings.

D. Tax Details:

This tab mandates mentioning of details of taxes paid by the taxpayer including TDS, TCS, Advance tax and self-assessment tax. However, this information gets auto-populate from Form 26AS, still, the taxpayers should cross-check details from the TDS certificate issued by the deductor (for ex. Employer, banks, tenants, etc.)

E. Taxes Paid and Verification:

This tab contains the information of tax payable by, or refund due to the taxpayer after mentioning details in the 'Tax Details' tab and tabs of sections 80G and 80GGA deductions. If any tax left to include in this calculation, the taxpayer is responsible for paying the self-assessment tax before filing for tax return. However, the assesses should remember to provide the challan details of self-assessment tax in Tab D (Tax Details).

F. Donation-80G:

The Donation-80G demands for mentioning details of any donation made by the taxpayer. It helps in claiming deduction under section 80G. This tab contains information like the details of the donee and the amount donated to the certain notified funds, charitable institutions or other institutions. Other than providing the details of any donation made, the taxpayer has to specify the mode of payment used for a donation from this year. In case the donation made in the form of cash and it exceeds INR 2,000, the amount is not considered for a deduction from gross total income.

G. Donation- 80GGA:

This tab also demands to mention of donations but specifically made in the field of research/rural development. Here the taxpayer claim deduction under section 80GGA. All the taxpayers including those who earn from business are allowed for claiming deduction under this section.

Step 5: Form Verification and then Preview & Submit

After entering all the details required in the form, the taxpayer requires to proceed with the verification option as it is mandatory to complete the ITR filing process. And, the ‘Taxes Paid and Verification' tab used to perform this activity post reporting bank account details as mentioned above.