Friday, May 23, 2014

Vital documents that must accompany your income tax return

Here’s a list of documents that one needs to be ready with, before filing his/her returns.

1. Permanent Account Number: Knowing your PAN number is the first step towards filing your return. You must cross check your PAN number online with the Income Tax Department before you begin to fill in your Income Tax Return on their website.

2. Form-16: The Form-16 is a form/statement issued by the employer carrying the details of your salary, the amount of taxable salary calculated after extra allowances, the Tax Deduction at Source deducted, the income tax deductions that you claim and the net tax due. Via TDS, the employer must have already deducted and deposited a part of your salary to the Income Tax Department.

3. Balance Confirmation Statements: You must declare all the incomes sourcing from interests earned on bank savings deposits, fixed deposits and debentures in the last financial year in the Income Tax Returns.

4. Certificate of Tax Deducted at Source: After verifying whether TDS has been duly deducted, you must furnish the TDS entries in the Tax Return to decrease the tax liability.

5. Form 26AS: The Form 26AS is a statement of all of your income tax received by the IT Department. It is a statement of tax credit showing voluntary tax payments, in addition to the TDS.

6. Proof of Exempted InvestmentsThe investments made under LIC, PPF, children’s tuition fee are eligible for tax deductions.

The payment as the principal amount of a housing loan also qualifies for the same with an upper limit of INR 1,00,000. However, if you reside in a house you are paying EMIs for, the EMI amount could be claimed for deduction with an upper cap of INR 1,50,000.

Donations certified to be in the name of charity can be declared for tax deductions as well. The PAN number of the charitable institution is required too.

Other Proofs of Investment: The interest you have paid on an education loan for higher studies can be claimed for IT deduction and so can the medical insurance payments for your family and your parents, capital gain on stocks (A Stock Trading Statement is required and has to be tallied with the Brokerage Account) and capital gain on the sale of owned property.


These are the documents and proofs, for claiming Tax Returns with the IT Department in India that are absolutely essential and help ease the process of filing a return.