How to use ITR – 1 (Income Tax Returns) Form?

Last date for filing IT returns is July 31st, 2011.  There is only one month more to complete the IT returns filing. So, i would publish few articles on the IT returns in coming days to explain the details of IT returns and how to do it?. It will help our readers to understand what exactly is the IT returns and how to fill the form. In this post, I am starting the ITR – 1 form  which is mostly used for the individual and salaried people to file the IT returns. Since, it is important to understand the Income Tax Returns filing, please ask your doubts in the comments.

Who Can Use ITR – 1?

If you are satisfying the following conditions, then you can choose ITR-1 to file the income tax returns:

• If you have income from Salary/Pension.  (or)
• If you have income from one house property (excluding losses brought froward from previous year). If you have income from more then house, then you can not use this form. (or)
• Income from other sources (excluding winning from lottery and race horses). This category includes income from fixed deposit interest rates, etc.
• In cases where the income of spouse or minor is clubbed with the assessee, those incomes should fall under the above category.

Who Can not Use ITR – 1?

• If you have income from more than one house property.
• If you have income from winning for lottery or race horses.
• Income from agriculture exceeds Rs.5000.
• Income from any other business or profession.

Income Tax Slab for the FY 2010-11

Every year finance minister would announce in the budget speech about the maximum limit for the tax free income. That mean up to certain limit one individual need not pay any tax for their income.

• Men (below age of 65 years) – Rs. 160000
• Women (below age of 65 years) – Rs.190000
• Individual with age of more than 65 years – Rs.240000

Every individual who has the total income (before allowing the deductions under chapter -VI A) exceeds the above specified limits, he/she is responsible to submit the IT returns. Also read below section.

Who need not submit the IT Returns?

• If individual fall under the above mentioned income tax slab (or)
• If an individual have total income of Rs.500000 after the deductions, consisting of salary from single employer and interest income from deposits in savings bank account up to Rs.10000 need not file the IT returns. Those individuals, submit their PAN and total interest income on deposits to the employer and pay the tax as the TDS (What is TDS and TAN?) and get the Form 16 (What is Form 16?) certificate.

Difference Between Financial Year and Assessment Year

It is one of the basic term which is used while filing the IT returns. If you are filing the income tax returns for the first time, you would have puzzled with this terms. The following is the simple definition for each term:

• Financial Year (FY): The year which you used for calculating the total income is financial year. For example, current financial year is 2011-12.  In India, the financial year starts from 1st April and ends in 31st March. This may vary from each country.
• Assessment Year (AY):The year which you are paying the tax for your previous year. For example, assessment year for the current financial year 2011-12 will be 2012-13. In simple words, following year of the financial year is called as the assessment year.

How to Submit IT Returns?

The last date for submitting the Income Tax Returns is July 31st, 2011.  The following are the process to submit the ITR-1:

• Get the Form 16 from your employer. If you worked with more than one employer, get the form 16 from each employer. If you are not aware of this form, read what is form 16?.
• You can download the ITR-1 form from here.
• The following are the different ways to submit your ITR-1to the income tax department:
  • By filing the downloaded ITR-1 form and submit to the income tax office.
  • By send electronically using the digital signature. In this case you have to buy the digital signature from any of the authorized company. In this type, you need not send the verification of return again.
  • By sending the electronically with out digital signature, then submitting the verification of the return in form ITR-V. This is most commonly used method of submitting the Income Tax Returns.

Submitting Income Tax Returns Through Web Sites

In the above categories, I have mentioned as submitting the details electronically. There is many websites in the market offering the filing it returns online. we are not required to go directly to the income tax office and do the paper work. If you are ready to pay small fees like Rs. 199 or Rs.299, they will submit the details electronically to the income tax office.

I have already explained about one of the leading online income tax filing provider in this blog. We have experienced that portal and it is easy to submit your returns without breaking your head. The direct link to fill the returns is: Income Tax Returns Online

Summary

I hope this article would be more useful for the readers to understand the income tax returns and submit it without much risk. In the coming days, I will explain about the different types of Income Tax Returns. Please submit your feedback about this article in the comments section.