Five Steps to File Income Tax Returns for First Time

filing income tax returns

To file your Income Tax Return (ITR), you must first register and create an account on the official portal of the Income Tax Department.

Once you’ve established your account, it’s highly advisable to set up the e-filing vault for added security. This feature provides an additional layer of authentication, safeguarding your financial information against unauthorized access.

For first-time filers, it’s essential to note that ITR can only be filed electronically (e-filing) through the income tax website, except for very senior citizens aged 80 years or above, who may file their returns in paper mode if they meet specific criteria.

For the majority, whether filing independently, with professional assistance, or through private tax filing portals, e-filing is mandatory.

Here’s a step-by-step guide on how to register and create an e-filing account:

Step 1: Register and Create an Account

  1. Visit the official Income Tax Department portal:
  2. Click on the ‘Register’ tab for new users, located at the top right-hand corner of the portal.
  3. Provide your 10-digit alphanumeric Permanent Account Number (PAN) to verify its authenticity and registration status.

Step 2: Confirm Your Status as an Individual Taxpayer

  1. After PAN validation, confirm your status as an ‘Individual taxpayer.’
  2. Enter your last name, middle name, and first name, ensuring accuracy matching the information on your PAN.
  3. Select your gender and residential status.

Step 3: Provide Contact Details and Address

  1. Provide a primary mobile number and email ID for verification. Ensure that these contact details belong to you.
  2. Enter your postal address accurately, as all information provided is mandatory for filing.

Step 4: Set a Password and Verification

  1. Set a secure password.
  2. Click ‘Continue,’ and you will receive a six-digit OTP1 and OTP2 on your registered mobile number and email ID.
  3. Enter the correct OTPs to complete the registration process.

Enhance Security with E-filing Vault

Setting up the e-filing vault is highly recommended for added security. This feature requires a one-time password (OTP) for each login attempt to your e-filing account, ensuring the protection of your financial information. To utilize the e-vault:

  1. Visit the ‘Profile settings’ tab.
  2. Select ‘E-filing Vault – higher security.’
  3. Choose one or more higher security methods, such as Aadhaar linkage for OTP generation, net banking, or a Digital Signature Certificate (DSC).
  4. Upon your next login, an additional authentication step using your chosen method will be enforced.

Understanding Who Needs to File an Income Tax Return

As per the Income Tax Act 1961, it’s mandatory to file an ITR if your income exceeds the basic exemption limit.

For the financial year 2022-23 (assessment year 2023-24), the limit is up to Rs 2.5 lakh for those below 60 years, up to Rs 3 lakh for ages 61 to 80, and up to Rs 5 lakh for those above 80.

Certain circumstances, such as capital losses, high credit card bills, foreign income, and more, also necessitate filing.

Other Uses of Your Account

Beyond filing returns, your account provides access to various services, including viewing and downloading previous tax returns, Form 26AS, Annual Information Statement (AIS), and addressing grievances related to e-filing, refund processing, errors, demand correction, and more.

You can also act as a representative assesses or register representatives for specific purposes within the e-filing platform. By creating an e-filing account and utilizing its features, you can efficiently manage your tax-related tasks and ensure the security and accuracy of your financial data.

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