Filing your Income Tax Return: Be prepared with these essential documents

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Tax season is upon us, and with the deadline for filing your return of income just around the corner (31^st July, 2023), it's time to get organized. While the introduction of pre-filled income tax forms has made the process easier, it's essential for taxpayers to verify the information and keep the following documents and details handy. Let's take a closer look at what you need to ensure a smooth and hassle-free filing experience.

1. Annual Information Statement (AIS)

In the year 2021, the Income Tax Department launched the AIS, which is a detailed summary of a taxpayer's information relating to tax deducted at source (TDS), tax collected at source (TCS), interest, dividends, stock market transactions, mutual fund transactions, property related transactions etc. Though the income tax forms are pre-filled and AIS information is available, you should always verify its correctness, and only after such verification should you file the return of income.

2. Bank Accounts Information

Gather all the necessary details about your bank accounts. You are required to provide details of all active savings accounts held by you at any time during the financial year. Make a note of the bank name, account number, account type, and IFSC code. These details are mandatory for filing your return of income. To avoid any last-minute hassle, obtain all your bank account statements well in advance.

3. Aadhaar Number/Enrolment Number

Remember, it is necessary to provide your Aadhaar Number in your return of income (if you are eligible to obtain it) and also link your PAN with your Aadhaar Number. Failure to link your PAN and Aadhaar Number can result in higher TDS/TCS rates, and no refund shall be given. Ensure that you complete this step to stay in compliance with tax regulations. If you have applied for an Aadhaar Number, it is crucial to have your enrolment number ready, which is to be provided in the return of income.

4. Form 16 (for salaried individuals):

Salaried individuals should keep a close eye on their Form 16, a certificate issued by their employer. It contains vital information such as gross salary, perquisites, and TDS on salary. Remember, employers are required to issue Form 16 by 15^th June 2023, so ensure you have it before filing your return.

5. Tax Saving Investments

If you have made tax-saving investments during the year, gather all the relevant documents related to these investments. This includes payments made for life insurance, health insurance, PPF, tax-saving deposits, etc. These expenses are eligible for deduction from your income. For homeowners, it is necessary to keep the details and documents relating to home loan instalments handy as both principal and interest are eligible for deduction. However, note that if you have opted for the new tax regime u/s 115BAC, certain investment deductions may not be applicable.

6. Interest Certificates

Interest income from savings accounts, fixed deposits, recurring deposits, and other sources must be considered while filing your return. Make sure to obtain interest certificates from banks, post offices, or any other institutions where you have invested. Additionally, remember to claim eligible deductions, such as up to Rs. 10,000 for interest on savings accounts.

7. Share/Mutual Fund Transaction Related Documents

If you have engaged in shares or mutual fund transactions, it's crucial to compute capital gains or losses when you sell such investments. Obtain gain/loss statements, transaction statements, demat account statements from your broker, and account statements from mutual fund houses to accurately disclose this information in your return.

8. Tax payments

TDS applies to various types of income, including salary, interest, dividends, and sale considerations for immovable property. Ensure you obtain the relevant TDS certificates (such as Form 16/Form 16A/Form 16B) from your employer, banks, or property purchasers. Further, TCS is collected on transactions like the purchase of motor vehicles, foreign remittances, purchase of overseas tour program packages etc. Ensure to obtain a TCS certificate (Form 27D) from the authorized dealer, seller etc. Further, if you have made advance tax payments, make sure to keep the tax payment challans handy. If these are unavailable, you can download Form 26AS or AIS from your income tax portal to access this information.

Also, after computing the total income, you may be liable to pay a self-assessment tax. Please note that you are required to pay the self-assessment tax before filing your return of income. You can pay the same using your Kotak Mahindra Bank Account or by any other payment mode like debit card or credit card or UPI via the Kotak Payment Gateway.

9. Details of Assets and Liabilities

For individuals whose income exceeds Rs. 50 lakh, it is essential to provide comprehensive details of their assets and liabilities. This requirement aims to ensure transparency and prevent potential tax litigation in the future. While filing your return of income, make sure to have the necessary information regarding your assets and liabilities readily available. Accurately disclose these details as required, as it plays a crucial role in maintaining compliance with tax regulations and minimizing the risk of future disputes. By being proactive and including this information, you can avoid potential complications and streamline the filing process.

Other Details: Two additional pieces of information to keep in mind while filing your return of income are:

(i) Details of Unlisted Shares: If you hold any unlisted shares in a private limited company, it is essential to disclose this information in your return of income.

(ii) Directorship in an Indian Company: If you hold any directorship position in an Indian company during the previous year, ensure to provide these details in your return of income.

By including these details accurately, you can fulfil the tax authorities' requirements and ensure compliance with income tax regulations.

Conclusion:

With the income tax filing deadline fast approaching, being prepared is the key to a stress-free experience. By keeping the above-mentioned documents and details handy, you can ensure the smooth completion of your return of income. Remember to verify the pre-filled information and seek professional assistance if needed. Stay organized and embrace the journey towards financial compliance.

This Article is for information purposes only. The views expressed in this Article do not necessarily constitute the views of Kotak Mahindra Bank Ltd. ("Bank") or its employees. The Bank makes no warranty of any kind with respect to the completeness or accuracy of the material and articles contained in this Article. The information contained in this Article is sourced from empanelled external experts for the benefit of the customers, and it does not constitute legal advice from the Bank. The Bank, its directors, employees and the contributors shall not be responsible or liable for any damage or loss resulting from or arising due to reliance on or use of any information contained herein. Tax laws are subject to amendment from time to time. The above information is for general understanding and reference. This is not legal advice or tax advice, and users are advised to consult their tax advisors before making any decision or taking any action.

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Disclaimer: This Article is for information purposes only. The views expressed in this Article do not necessarily constitute the views of Kotak Mahindra Bank Ltd. (“Bank”) or its employees. The Bank makes no warranty of any kind with respect to the completeness or accuracy of the material and articles contained in this Article. The information contained in this Article is sourced from empanelled external experts for the benefit of the customers and it does not constitute legal advice from the Bank. The Bank, its directors, employees and the contributors shall not be responsible or liable for any damage or loss resulting from or arising due to reliance on or use of any information contained herein. Tax laws are subject to amendment from time to time. The above information is for general understanding and reference. This is not legal advice or tax advice, and users are advised to consult their tax advisors before making any decision or taking any action.