The Income Tax (I-T) department has made all utilities available and notified all required forms for filing income tax returns online in April.
Typically, this process is not completed right at the beginning of the financial year, but at a later stage. However, this does not mean that income taxpayers can start fulfilling their yearly obligation right away, at least not all of them.
Salaried and FD investors must wait
Most salaried taxpayers will not be able to file their returns at this time. This is because the TDS payments by employers (for tax deducted at source on salaries) and banks (for TDS on fixed deposit interest) will be completed by April 30.
Entities will start issuing Forms 16 and TDS certificates only after May 31, and that is when salaried individuals and those earning fixed deposit interest can begin the filing process,” explained Chetan Chandak, director of TaxBirbal, a tax consultancy firm.
Form 16 is a certificate of TDS on salary given by employers to employees.
Even if an individual has meticulously computed and maintained all TDS details, it is advisable to wait and go by Form 16 figures. This is because any discrepancy could lead to a query on mismatch in details from the tax authorities, which is best avoided, according to Nitesh Buddhadev, founder of Nimit Consultancy, a chartered accountancy firm.
Additionally, until your deductor entity files TDS returns, the income tax department will not process your returns,” added Chandak.
Limited options for filing returns in April
Only a very limited number of taxpayer categories can file returns in April, including NRIs with no other source of income in India except, for example, capital gains from the sale of property.
In such cases, the individual can benefit by filing returns in April as it will be processed sooner and any excess tax deducted will be refunded early, explained Chandak.
Indian citizens with property transactions that entail TDS of 1 percent can also benefit and claim a tax refund on the TDS withheld, as mentioned by Chandak.
Furthermore, individuals with capital gains and foreign citizens who have briefly worked in India can also benefit from filing their returns ahead of time to claim any excess tax deducted.
File early for quicker processing and refunds
While there is no rush to file returns in April, it is important to do so as soon as possible to avoid technical glitches and heavy traffic closer to July 31. The earlier the return is processed, the sooner any claimed tax refund will be available for use.
For individuals whose TDS has been withheld in the last quarter of 2023-2024, the filing process will start only after May 31. This is the deadline for deductors to file TDS returns, and they may take an additional two weeks to 15 days to issue TDS certificates or Form 16. Thus, it is advisable for individuals to commence the process of filing returns after June 15, according to Mayank Mohanka, Founder of TaxAaraam.com and Partner at SM Mohanka and Associates.