efiling Tax

July 1, 2009

Online: Known as efiling, this method is fast catching up. Ankur Sharma, managing director, TaxSpanner.com, an efiling site, says there has been an increase in efiling this year over last year. “Unlike last year, when efiling picked up only in June, activity has been building up since May this year,” he says.

Last year, nearly 4.8 million returns were e-filed. Out of this, 4 million were by individuals and non-corporate entities.

Sharma says availability of digitally signed Form 16 from the employers is making efiling popular. He says: “Employees who have digitally signed Form 16 would simply have to send it to us and their returns would automatically be filed. They wouldn’t even need to fill up the form.”

Filing returns online is compulsory for companies, but optional for salaried individuals. In the future it will become compulsory for individuals with a certain level of income, so it may not be a bad idea to familiarise yourself with the process.

E-filing process

In order to efile your returns, you will have to input the details of Form 16 in the software of the website, which would automatically generate an electronic return in XML format.

This format helps in sharing of structured data across different information systems. A PDF file of the relevant ITR form is also created along with the XML format on the desktop of your computer. You can download this ITR form, submit it at the ITO and get an acknowledgement.

Alternatively, save the XML file on your desktop and then upload it on www.incometaxindiaefiling.gov.in, the government site. Private sites upload it on the government site on your behalf. You will get the acknowledgement by email.

Using Digital Signature

Using a DS will help you complete the efiling process without paperwork and visits to the ITO. In case DS is used, the acknowledgement is emailed to the taxpayer.

Why DS?

Though not mandatory, it is advisable to use a DS for filing your return electronically. A DS authenticates electronic documents in the same way as a handwritten signature authenticates printed documents.

However, using a DS makes efiling a little expensive — every website has its own charges and it has a validity of one or two years. The cost of DS may be built into the package you choose.

How to get a DS?

A DS can be acquired from any of the agencies authorised by the government for the job, including the private and government websites meant for filing tax returns. To get your DS from a tax site, download the relevant form, fill it up, attach the required documents, such as your identity and address proofs, and courier them to the address concerned. The entire process of acquiring a DS may take around 15 days.

E-filing without DS

E-filing without DS is equally convenient now. After filing the returns online, the taxpayer receives an acknowledgment called the ITR-V. Till last year, ITR-V had to be submitted at the nearest ITO, making efiling a manual affair at the end.

From this year, this form just needs to be couriered to a specific IT office in Bangalore making the process convenient for assessees.

E-filing sites

Among the major sites designated to offer efiling facilities are http://www.taxspanner.com, www.taxsmile.com and www.taxshax.com. Costs vary across sites.

The government too has a site that offers this facility free of cost. The site is: www.incometaxindiaefiling.gov.in/portal/index.jsp. You will have to use your Permanent Account Number (PAN) as the username for registering on this site.

All the three non-government sites mentioned above are secure and easy to navigate. They are different from each other on two major counts — the number of income sources they cover and the process.

Get clarity on the cost and features offered before opting for one. Says Ravi Jagannathan, managing director of http://www.taxsmile.com, “Check if special cases like arrears or clubbing of income are also taken care of.” This will save the pain of starting the process all over again.

The cheapest package would normally cover only salary income. You may require the advanced version if you have income from other sources. Taxspanner is the only private site through which you can fill ITR-4, meant for individuals with business or professional income.


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