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Filing taxes can feel complicated, whether you’re an individual or a small business owner. However, understanding the process step by step ensures accurate filing, avoids penalties, and helps you make the most of available deductions and exemptions.
1. Gather Your Financial Documents
Before filing, collect all relevant documents:
For Individuals:
Form 16 (from employer)
Bank statements and interest certificates
Investment proofs for tax-saving deductions
Rental income or property documents (if applicable)
For Small Businesses:
Profit and loss statements
Balance sheet and accounting records
GST returns (if applicable)
Receipts and invoices for expenses and income
Having documents organized makes the process smooth and error-free.
2. Determine Your Taxable Income
Individuals: Sum up your income from:
Salary or wages
Freelance or business income
Interest, dividends, or capital gains
Apply deductions under Sections 80C, 80D, etc. to reduce taxable income.
Small Businesses:
Net income from sales minus business expenses
Consider depreciation, loan interest, and other business deductions
Calculate GST and advance tax liabilities if applicable
Accurate computation is key to paying the right amount of tax.
3. Choose the Correct Tax Regime
Individuals:
Old Regime: Allows deductions and exemptions
New Regime: Lower tax slabs but no exemptions
Businesses:
Decide between presumptive taxation or regular taxation based on turnover and business type.
Choosing the right regime optimizes tax liability.
4. Select the Appropriate Tax Forms
Individuals:
ITR-1: Salaried individuals with no business income
ITR-2: Individuals with capital gains, foreign income
ITR-3/4: Self-employed or business income
Small Businesses:
ITR-4 (Presumptive business)
ITR-5/6: Partnership firms or corporate entities
Filing with the correct form prevents errors and rejections.
5. File Online Through the Income Tax Portal
Steps:
Visit the Income Tax e-filing portal
Login using PAN and password
Choose appropriate ITR form
Fill in income, deductions, and tax paid
Validate entries and submit
Online filing is fast, secure, and convenient.
6. Verify Your Income Tax Return
After submission, verify your ITR:
Aadhaar OTP or e-verification via net banking
Send signed ITR-V to CPC (if offline)
Verification ensures your return is processed and eligible for refunds.
7. Pay Any Outstanding Tax
Calculate tax payable minus TDS
Pay any balance tax online
Keep challans and receipts for records
Timely payment avoids interest and penalties.
8. Maintain Records
Keep all financial documents, ITR copies, and receipts for at least 6 years
Helps in future audits, loan applications, and legal compliance
Conclusion
Filing taxes doesn’t have to be stressful. By following this step-by-step guide, individuals and small business owners can file accurately, claim all eligible deductions, and stay compliant. Organized preparation, proper form selection, and timely submission are the keys to hassle-free tax filing.
FAQs
Q1: What is the deadline for filing taxes in India?
For FY 2025-26, the deadline for individuals without audit requirements is 15 September 2025.
Q2: Can I file my ITR online?
Yes, online filing through the Income Tax e-filing portal is fast, secure, and convenient.
Q3: Which form should a small business owner use?
It depends on business type: ITR-4 for presumptive taxation, ITR-5/6 for firms or corporate entities.
Q4: Can I claim deductions after filing my ITR?
Yes, by filing a revised return before the due date of the assessment year.
Q5: How long should I keep my tax records?
Maintain documents for at least 6 years for future reference and audits.
Published on : 12th September
Published by : SMITA
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