Filing your Income Tax Return (ITR) might seem intimidating the first time — government portals, confusing forms, and a fear of making a mistake. But for most salaried employees, ITR filing is actually straightforward once you know what to do. The Income Tax portal has improved dramatically and now pre-fills much of your data automatically.
This guide walks you through every step — from deciding whether you need to file at all, to choosing the right form, gathering documents, and e-verifying — so you can file your ITR confidently before the July 31 deadline.
Do You Actually Need to File an ITR?
Many people think ITR filing is only for those who owe tax. That's wrong. You must file an ITR if any of these apply to you:
- Gross income exceeds ₹2.5 lakh (before deductions) in the financial year
- Income exceeds ₹50 lakh — mandatory regardless of tax liability
- You have foreign assets or income, or are a signatory on a foreign bank account
- You spent more than ₹2 lakh on foreign travel in the year
- Your electricity bill exceeded ₹1 lakh in the year
- You want to claim a TDS refund — for example, if your bank deducted TDS on FD interest but your total income was below the taxable threshold
- You have carry-forward losses (capital losses, house property losses) that you want to offset in future years
Even if your income is below the taxable limit, filing ITR is beneficial. ITR acknowledgement is required for visa applications, loan applications, and as proof of income. It also establishes your financial history.
Which ITR Form Should You Use?
| ITR Form | Who Should Use It |
|---|---|
| ITR-1 (Sahaj) | Salaried individuals with income up to ₹50 lakh, one house property (no losses), and income from other sources (interest, dividends) |
| ITR-2 | Income above ₹50 lakh, two or more house properties, capital gains, foreign income/assets, or director in a company |
| ITR-3 | Business or professional income in addition to salary |
| ITR-4 (Sugam) | Freelancers and small business owners under presumptive taxation (Sections 44AD, 44ADA, 44AE) |
If you're a salaried employee with a single employer and no other complex income, ITR-1 is your form. This guide focuses on ITR-1.
Documents You Need Before You Start
- Form 16: Issued by your employer — contains salary breakup and TDS details. Must be received by June 15.
- Form 26AS: Your annual tax statement — download from the IT portal. Shows all TDS deducted across salary, bank, etc.
- Annual Information Statement (AIS): A detailed statement of all financial transactions — available on the IT portal under "Services > AIS"
- Bank statements: For interest income from savings accounts and FDs
- Investment proofs for deductions: 80C receipts (PPF passbook, ELSS statements, LIC receipts), health insurance premium receipts (80D), home loan interest certificate (Section 24b)
- PAN and Aadhaar: For login and e-verification
- Bank account details: Account number and IFSC code for refund credit
Step-by-Step: Filing ITR-1 on the Income Tax Portal
Go to incometax.gov.in and click "Login." Use your PAN as User ID. If first-time login, register first. Ensure your Aadhaar is linked to your PAN before proceeding — ITR filing and e-verification require this.
After logging in, go to "e-File" → "Income Tax Returns" → "File Income Tax Return." Select Assessment Year (AY 2025-26 for FY 2024-25), choose "Online" mode, and select "Continue."
Click on ITR-1 (Sahaj). Choose "Individual" as the filing status. Select the reason for filing — "Taxable income above basic exemption limit" or "To claim refund" etc.
The portal pre-fills personal information, employer details, salary income, and TDS data from Form 26AS and AIS. Review each section carefully. Don't assume the pre-filled data is always correct — cross-check every figure against your Form 16.
In the "Income Sources" section, verify or enter your salary as per Form 16 Part B. Enter HRA exemption, LTA, and other Section 10 exemptions if applicable. The standard deduction of ₹50,000 (old regime) or ₹75,000 (new regime) is applied automatically.
Add savings account interest (check your bank statement), FD interest (check Form 26AS for TDS), dividend income from stocks/mutual funds, etc. Banks report this to AIS, so the portal may already have some entries — verify them.
If you chose the old regime, go to "Deductions" and enter: 80C (up to ₹1.5L), 80D (health insurance), 80E (education loan interest), 80G (donations), 80CCD(1B) (NPS), etc. Enter only what you have genuine proofs for — mismatches are flagged during scrutiny.
The portal will ask you to confirm which tax regime you want. If you haven't informed your employer and want the old regime, select it here. The tax computation will update in real-time.
The portal shows your total income, deductions, taxable income, tax payable, TDS already deducted, and net tax payable/refund. If you owe additional tax, pay it via "Self Assessment Tax" using Challan 280 before filing. Note the BSR code and challan number.
Ensure your bank account is pre-validated on the portal (My Profile → Bank Accounts). Only a pre-validated account can receive ITR refund. Add your account if not already done.
Click "Preview Return" to review the complete ITR before submission. Scroll through all sections. Once satisfied, click "Submit." You'll be taken to the e-verification screen.
E-verification is mandatory — an unverified ITR is treated as not filed. The easiest method is Aadhaar OTP: your registered mobile number receives an OTP, enter it, and your ITR is verified instantly. Alternatively, use net banking, Demat account, or send a signed physical ITR-V to CPC Bengaluru by post (within 30 days).
ITR Deadline and Penalties
| Situation | Deadline | Penalty |
|---|---|---|
| Normal filing (income above ₹5L) | July 31, 2025 | ₹5,000 under Section 234F if filed after deadline |
| Normal filing (income up to ₹5L) | July 31, 2025 | ₹1,000 if filed after deadline |
| Belated return | December 31, 2025 | ₹1,000–₹5,000 + interest on tax due |
| Updated return (ITR-U) | Within 2 years | 25%–50% additional tax on shortfall |
Benefits of Filing Even When No Tax is Due
- Loan applications: Most banks ask for last 2–3 years' ITR acknowledgements for home loans and business loans
- Visa applications: USA, UK, Canada, Schengen visas often require ITR as proof of financial standing
- Carry forward losses: Capital losses can only be carried forward if you file by the due date
- TDS refund: If excess TDS was deducted, filing ITR is the only way to claim it back
- Financial record: ITR is one of the most reliable income proofs accepted by all financial institutions
Final Checklist Before Filing
Form 16 received ✓ | Form 26AS downloaded ✓ | AIS reviewed ✓ | Bank interest noted ✓ | Deduction proofs ready ✓ | Bank account pre-validated ✓ | Tax regime chosen ✓ | Any tax due paid via Challan 280 ✓ | Aadhaar linked to PAN ✓. File before July 31 to avoid penalties and interest.
Know Your Tax Before You File
Use the Arthmantra Income Tax Calculator to compute your tax liability in both regimes, estimate your refund, and plan your deductions — free, no login needed.
Try the Tax Calculator