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Direct Taxation
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E-Filing

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Harish Bojja
5 BBA FIB A
1523516
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What is E-Filing?
E-filing or electronic filing is submitting your income tax returns online. It is the process of
submitting tax returns over the Internet, using tax preparation software that has been pre-
approved by the relevant tax authority, such as the Income tax department of India .

Usually, there are two ways to file tax returns-

1. The traditional way is the offline way, where you go the Income Tax Departments office to
physically file your returns.

2.The other way is when you e-file through the internet.

Why is it beneficiary?
1.The taxpayer can file a tax return from the comfort of home

2.Tax can be filed at any convenient time, once the tax agency begins accepting returns.

3.E-filed returns can be processed much faster than paper returns.

4.The taxpayer can generally expect a faster tax refund, if applicable.

5.E-filing saves the tax agency time and money, because the tax data is transmitted directly into
its computers, significantly reducing the possibility of keying and input errors.

Mandatory Assesse For E-filing

From assessment year 2012-13, e-filing is mandatory for those with annual income of more than
Rs 10 lakh.

Source of Income Income Is it Mandatory?

Salary, Capital gains, >10Lakh Yes

Interest Incomes and rental
incomes.
Professional and contract >15Lakh Yes
employees.

Business Income Gross receipts above Yes

1Crore INR

Individuals or HUF's Any Yes

holding assets overseas
Additional Requirements for Salaried Employees for E-filing-

1.Form 16

2.Bank statements

3.Interest and tax deduction certificates

Digital Signature Requirements For E-filing?

E-filing with digital signature is mandatory for those with business income of Rs 1 crore or more
and professionals with income of Rs 25 lakh or more. Till last year, e-filing was mandatory if the
figures exceeded Rs 60 lakh and Rs 15 lakh, respectively. E-filing is now mandatory for
individuals and Hindu Undivided Families whose accounts have to be audited under Section
44AB of the Income Tax Act.

Source of Income Income Is it Mandatory?

Salary, Capital gains, >10Lakh No

Interest Incomes and rental
incomes.
Professional and contract >15Lakh Yes
employees.

Business Income Gross receipts above Yes

1Crore INR

Individuals or HUF's Any No

holding assets overseas
Modes of E-filing

Pre-requisite for registration in e-Filing application

A user must register at www.incometaxindiaefiling.gov.in

Pre-requisites to register

1) PAN (Permanent Account Number)

2) TAN (Tax Deduction Account Number)

3) Membership with ICAI For Chartered Accountant

Registration process

1) Provide PAN / TAN, Password details, Personal details as per PAN / TAN, Contact details
and Digital signature (if available and applicable)

2) Submit request

3) On success, Activation link is sent to user through e-mail and a mobile PIN to mobile number.
Click on the activation link and provide Mobile PIN to activate e-Filing account.

Once registered, LOGIN using User ID (PAN/TAN), Password, Date of Birth/ Incorporation and
Captcha code.
Methods of e-Filing of Income Tax

1) Preparing the Income Tax return off-line using return preparation software, available free of
cost at the Income Tax Department e-Filing website and Uploading the Income Tax Return data.

A taxpayer can e-File Income Tax Return from ITR 1 to ITR 7.

2) Submit ITR-1/ITR4S Online An Individual taxpayer can prepare and submit Income Tax
Return- ITR 1/ITR4S-Online.

e-Filing of Income Tax Returns (Offline)

Steps to download utility and generate XML

Excel Utility

1) www.incometaxindiaefiling.gov.in e-Filing Home Page

2) Click on the ITR under Downloads
3) Click on Download link and save the ZIP file (Excel or JAVA utility)
4) Extract the downloaded ZIP File
5) Open the utility, Click on Import Personal / Tax details from XML >Browse and attached
the downloaded Prefill XML file to populate the personal information and TDS details.
6) Enter all the Mandatory Fields > Validate all the sheets > Calculate Tax > Generate XML.
7) Login using e-Filing user credentials
8) Navigate to e-File Tab > Click onUpload Return
9) Select ITR Form Name and Assessment Year from the dropdown provided.
10) Browse and attach XML file.
11) Select Do you want to digitally sign?>
12) On successful submit taxpayer will get an option to e-verify return.

JAVA Utility

1) www.incometaxindiaefiling.gov.in e-Filing Home Page

2) Click on the ITR under Downloads
3) Click on Download link and save the ZIP file (Excel or JAVA utility)
4) Extract the downloaded ZIP File
5) Open the utility, Click on Prefill >Enter UserId, Password, DOB/DOI and
select Prefill Address(From PAN Details, From previous ITR Form Filed, None) > click
Prefill
6) Enter all the Mandatory Fields > Calculate Tax > save XML.
7) Click on Submit >Enter Password and select Do you want to digitally sign? >Submit

Process and Submission of ITR1/ITR 4S Online

The taxpayer has the option of submitting ITR 1/ITR 4S by way of Uploading XML OR by
Online submission

Steps to e-File Online ITR (ITR 1 and ITR 4S)

1) www.incometaxindiaefiling.gov.in e-Filing Home Page

2) Login using e-Filing user credentials
3) Navigate to e-File Tab > Click on Prepare and Submit Online ITR
4) Select ITR Form Name from the drop down (ITR-1 or ITR-4S)
5) Select Assessment Year > Select the Radio button Prefill Address with to auto populate
the address > Select the Radio button if DSC is applicable > Click on Submit
6) Enter the mandatory details in the online form > Click on Submit
Note:
1) To e-File using DSC, it should be registered in the e-Filing application.
2) If the Income Tax Return is digitally signed or electronically verified, on generation of
Acknowledgement the Return Filing process is complete. The return will be further processed
and the Assessee will be notified accordingly. Please check your emails on these notifications
3) If the return is not e-Filed with a DSC (digitally signed) or EVC (electronically verified), an
ITR-V Form will be generated. This is an Acknowledgement cum Verification form. A duly
verified ITR-V form should be signed and submitted to CPC, Post Bag No. 1, Electronic City
Post Office, Bangalore 560100 by Ordinary Post or Speed Post (without Acknowledgment)
ONLY, within 120 days from the date of e-Filing.
4) On receipt of the ITR-V at CPC, the return will be further processed and the Assessee will be
notified accordingly.

Register Digital Signature Certificate (DSC):

Follow the below steps to register DSC in e-Filing of income tax

1) www.incometaxindiaefiling.gov.in e-Filing Home Page

2) Login with e-Filing user id and credentials
3) Navigate to Profile Setting Tab > Click on Register Digital Signature Certificate
4) Download ITD e-Filing DSC Management Utility from the link provided in e-Filing
website Extract the downloaded DSC Utility > Open the Executable Jar File (DSC Utility)
5) Register/Reset Password using DSC tab
6) Enter e-Filing User ID, Enter PAN of the DSC, Select the type of DSC
7) DSC using .pfx file
8) Select the Type of DSC .pfx file
9) Browse and attach the Keystore file (.pfx File)
10) Enter the password for your private key
11) Click on Generate Signature file
12) DSC using USB token
13) Select the Type of DSC (.pfx file or USB token) USB Token
14) Select USB Token Certificate > Click on Generate Signature File
15) Browse and attach the signature file using the browse option > Submit,

Process of E-filing

STEP 1. Register yourself

To e-file your income tax return, you will have you register on the Income Tax Departments
online tax filing site (incometaxindiaefiling.gov.in). You have to provide your permanent
account number (PAN), name and date of birth and choose a password. Your PAN will be your
user ID.

STEP 2. Choose how you want to e-file

There are two ways of e-filing your income tax return. One is to go to the download section and
select the requisite form, save it on your desktop and fill all the details offline and then upload it
back on the site. Or you can choose to fill the form online by selecting the quick e-file option.

STEP 3. Select the requisite form

ITR-1: For individuals earning a salary, pension, or income from property or sources other than
lottery.
ITR-2: For those earning capital gains. ITR 2A for those owning more than one house but no
capital gains.
ITR 3, 4 and 4S: Professionals and business owners.

STEP 4. Keep the documents ready

Keep your PAN, Form 16, interest statements, TDS certificates, details of investments, insurance
and home loans handy. Download Form 26AS, which summarises tax paid against your PAN.
You can then validate your tax return with Form 26AS to check your tax liability.
If you earn more than Rs 50 lakh, from this year you will have to fill an additional column
"AL" or assets and liabilities. You will have to disclose the value of your assets and liabilities.
Assets have to be declared at cost.

STEP 5. Fill form and upload

If you choose to fill the form offline, after you have downloaded the form and filled all the
details, click on 'generate XML'. Then go to the website again and click on the 'upload XML'
button. You will have to first log in to upload the XML file saved on desktop and click on
submit.

STEP 6. Verify ITR V

On submitting your ITR form, an acknowledgement number is generated. In case the return is
submitted using digital signature, you just have to preserve this number. If the return is submitted
without a digital signature, an ITR-V is generated and is sent to your registered email ID.

The tax filing process is incomplete and ITR is invalid unless your ITR V is verified. You can
electronically verify or mail the signed ITR V to the processing centre in Bengaluru within 120
days of filing the return.

Selection of appropriate ITR forms

Category Type of Income Required ITR

1.Individuals
2.Individuals and HUF's
Income from ITR 1
salary/pension, one house
property ,other sources
having total income up to
INR 50 lakh
Income from salary ,more ITR 2
than one house property
other sources ,capital
 gains and income from
'Profits or gains from
business or profession or
remuneration from a
partnership firm but not in
nature of income from
carrying on business
under any proprietorship.
3.Individuals and HUF'S Income from a proprietary ITR 3
business or profession.