Tax portals facilitate filing of tax returns online. While opting for the online facility, make sure you hit the right buttons.
MAKING a switch to online from offline is not something new. Just as queues for utility bills or deposit money are becoming a thing of the past, the e-generation finds it a lot easier to do financial transactions in the office desktop or a personal laptop. With July 31 just a couple of weeks away, it's time to get papers in order to file your taxes. The traditional method has been to hire a chartered accountant who does the needful. But now, with the advent of tax portals, even tax filing can be done at your convenience from your office or home. But there are some basic things you have to keep in mind to ensure a safe and easy e-filing exercise.
Is the website trustworthy?
First, check how long the portal has been in the space of e-filing. However, considering the fact that e-filing of tax returns came into existence only four years ago, there may not be too much history to back up its credentials. If it's backed by a strong corporate, it adds to the portal's credentials. Second, the portal should be a licensed e-Return Intermediary (ERI), which is duly authorised by the income tax department. You will have access to this information on the website.
How secure is the transaction?
Ensure that the website you have registered with is a secure site. Whenever you have to submit some sensitive information online, you have to check if the site uses encryption to protect your personal data. The URL in the address bar should start with 'https://' and not just 'http://'.
What happens if you get stuck in the process?
You can get stuck in the process not necessarily by a technological glitch, but a tax hiccup if any. eTax Mentor, a tax portal, for instance, doesn't let you progress to the concluding stage if it identifies that you are required to pay additional tax. At this stage, you are directed to a bank's payment gateway in which you can pay the outstanding amount. The bank will generate a challan online and once you enter the details on the portal, it will guide you to the next stage.
Keep the documents in order
A basic document check before starting the entire process could be helpful. Form 16 is a crucial document which has to be provided by every tax payer. Second, if you have taken any housing loan, you need a copy of the receipts. If you are filing for HRA, you would need the rent receipts. You have to produce receipts on tax investments and other equity investments if you are filing for capital gains tax.
File your ITR-V within 120 days
ITR-V 'Income Tax Return — Verification' form is an acknowledgement given by the tax portal at the concluding stage. You can get this form with or without using a digital signature. However, professionals such as doctors or lawyers have to mandatorily opt for digital signature as they have to deal with lakhs of receipts. The I-T department, however, will verify the authenticity of the ITR if it's filed without using a digital signature. Digital signatures are valid for two years. However, if you time your buy smartly, you could use it for filing three returns. For instance, if you buy a digital signature on July 20, you can use it for filing next three tax returns provided you file the return before July 20, 2012. The starting price of digital signature is 100.
You don't need to understand the jargon
One of the reasons for outsourcing the tax filing exercise to a chartered accountant is the complexity associated with choosing the right tax form. Usually, such portals identify the right pick for you as you enter the employee, salary and other investment details.
How do you get tax refund?
You have to file the details of refund, if any, in the prescribed form. After approval of refund request by the authority concerned, the refund amount will be credited to your bank account. Refunds, however, are possible only if you file your return on time.
Working Out The Tax Arithmetic
STEPS to follow for e-filing of tax returns
THE NITTY-GRITTY OF THE PROCESS OF E-FILING OF TAXES CAN VARY FROM PORTAL TO PORTAL. BUT BROADLY, THE PROCESS LOOKS LIKE THIS:
You have to register your personal details to choose a log-in ID. At this stage, the portal will take you to the next stage to complete the registration details. eTax Mentor, a tax portal, however, mails the activation link to your e-mail ID registered with the portal. You have to complete the registration process by clicking on the link.
You have to enter the income particulars like ITR software tool, which would generate the ITR form in electronic format (XML file). You have to upload the form 16, enter other details on TDS, housing loan, if any, and other particulars of tax investments.
Once the process is done, a copy of your XML file is sent to your e-mail address. It will also give you an idea if you are eligible for a tax refund or liable to pay taxes.
You will be directed to the payment gateway to pay for the e-filing. Depending upon the service and portal, the fee can vary from Rs 49 to Rs 400.
An acknowledgement receipt called ITR Form-V would be generated and mailed to your e-mail ID. You have to download the form and mail it to the 'Income Tax Department — CPC, Post Box No. 1, Electronic City Post Office, Bangalore — 560100, Karnataka' within 120 days of e-filing.
The I-T department will send you the final acknowledgement which is the final step for e-tax filing.
