Tax season can be stressful, but it doesn't have to be. As salaried individuals, knowing your tax responsibilities and how to file your Income Tax Return (ITR) correctly can save you time, money, and stress. This guide is here to help you understand the basics of income tax filing and make the most of the deductions and benefits available to you.
At JJ Tax, we provide tailored tax solutions to meet your needs. Whether you're filing for the first time or looking to save more on taxes, our experts are here to help. Let’s break down the key aspects of filing your ITR as a salaried individual in India.
Who is a Salaried Employee for E-filing of ITR?
A salaried employee is someone who gets a regular pay check from an employer. This pay check, known as a salary, includes basic pay, allowances, and other benefits. For e-filing, a salaried employee's main income source is their salary.
Tax Rates on Salary Income
Your salary is taxed based on income tax slabs set by the government.
Income Tax Slabs Under New Tax Regime for FY 2023-24, FY 2024-25
The following tables show the Revised Income Tax Slabs, not the old tax regime. These new tax slabs in India were presented in the Budget 2023. The table for the new tax regime slabs-
Income Tax Slabs Under Old Tax Regime
Additional charges may apply depending on your income level. Knowing your tax slab helps you estimate your tax and plan ahead.
Basic Exemption Limits for FY 2023-24 and FY 2024-25
The basic exemption limit is the income level up to which you don’t have to pay any tax.
Under 60 years: ₹2.5 lakh
60 to 80 years: ₹3 lakh
Over 80 years: ₹5 lakh
Deductions on Salary Income
To reduce your taxable income, you can claim various deductions. Common ones for salaried individuals include:
Section 80C: Up to ₹1.5 lakh for investments like PPF, EPF, and LIC.
Section 80D: Up to ₹25,000 for health insurance premiums (₹50,000 for senior citizens).
Standard Deduction: ₹50,000 for all salaried employees.
House Rent Allowance (HRA): Deduction for rent paid, with certain conditions.
Home Loan Interest: Up to ₹2 lakh for interest paid on home loans (Section 24(b)).
These deductions can significantly lower your taxable income.
How to File ITR for Salary Income
Here’s a simple step-by-step guide to file your ITR:
Collect Necessary Documents: Form 16, salary slips, investment proofs, and bank statements.
Choose the Correct ITR Form: Typically, salaried individuals use ITR-1 (Sahaj).
Fill in the Details: Enter your personal info, income, and deductions in the form.
Submit the ITR Online: Use the Income Tax Department’s e-filing portal.
E-Verify Your Return: Complete the verification using Aadhaar OTP, net banking, etc.
Documents Required for Filing ITR
Ensure you have these documents:
Form 16: From your employer, showing your salary and TDS.
Salary Slips: Breakdown of your salary components.
Investment Proofs: For claiming deductions.
Bank Statements: For reporting interest income.
Home Loan Interest Certificate: If claiming home loan interest deduction.
Form 26AS: A tax statement showing details of tax deducted and deposited.
When to File ITR?
File your ITR by July 31 of the assessment year. For FY 2023-24, the due date is July 31, 2024.
Why File Income Tax Returns?
Filing ITR is important because:
Compliance: It's legally required if your income exceeds the exemption limit.
Refunds: You can claim refunds for excess tax deducted.
Loan and Visa Applications: ITR serves as proof of income.
Carry Forward Losses: File on time to carry forward losses to future years.
Avoid Penalties: Timely filing avoids penalties and interest.
Understanding and managing your tax responsibilities is crucial for your financial health. At JJ Tax, we offer tools and expertise to make tax season stress-free. Whether you need help with filing, tax planning, or financial advice, we are here to support you.