Salaried and Stressed: A Step-by-Step ITR Filing Guide

Salaried

Filing your Income Tax Return (ITR) is more than a statutory requirement—it’s a crucial step toward responsible financial management. For salaried individuals, filing returns not only ensures legal compliance under the Income Tax Act, 1961, but also helps in claiming refunds, maintaining financial records, and staying eligible for loans and visas.

Who Needs to File ITR?

According to Section 139(1) of the Income Tax Act, every individual whose total income exceeds the basic exemption limit must file an income tax return.

Exemption Limits for AY 2024–25

Age GroupBasic Exemption Limit
Below 60 years₹2.5 Lakhs
60 to 80 years (Senior Citizens)₹3 Lakhs
80 years and above (Super Seniors)₹5 Lakhs

In addition, return filing becomes mandatory if you:

  • Want to claim a refund of TDS or advance tax

  • Are a director in a company

  • Hold foreign assets or income

  • Have deposited ₹1 crore or more in a bank account

  • Incurred ₹2 lakh or more on foreign travel (Rule 12AB)

Which ITR Form Should Salaried Individuals Use?

The appropriate ITR form depends on your income composition and other financial details:

  • ITR-1 (Sahaj): For resident individuals with total income up to ₹50 lakh from salary, one house property, and other sources (excluding lottery winnings or race income)

  • ITR-2: For income above ₹50 lakh, or if you have capital gains, foreign income/assets, or multiple properties

Understanding Salary Income Components

Under Section 17(1) of the Income Tax Act, salary includes:

  • Basic salary

  • Dearness allowance (DA)

  • House Rent Allowance (HRA)

  • Leave Travel Allowance (LTA)

  • Perquisites (as per Sec 17(2))

  • Bonus/Commission

  • Pension, Gratuity, etc.

Note: Salary is taxable on the earlier of due or receipt basis.

Key Deductions for Salaried Taxpayers

Salaried employees can avail of several deductions under the Income Tax Act:

SectionDeduction TypeMaximum Limit
16(ia)Standard Deduction₹50,000
80CLIC, PPF, EPF, ELSS, etc.₹1.5 Lakhs
80DMedical Insurance₹25,000 – ₹50,000
80CCD(1B)Additional NPS Contribution₹50,000
80EEducation Loan InterestNo Limit
80TTAInterest on Savings Account₹10,000

Section 87A Rebate: Individuals with net taxable income ≤ ₹5 lakh are eligible for a rebate of up to ₹12,500 (effectively zero tax).

Tax Slabs for AY 2024–25

Old Tax Regime

Income SlabTax Rate
0 – ₹2.5 LakhsNil
₹2.5L – ₹5L5%
₹5L – ₹10L20%
Above ₹10L30%

New Tax Regime (Default) – Section 115BAC(1A)

Income SlabTax Rate
0 – ₹3 LakhsNil
₹3L – ₹6L5%
₹6L – ₹9L10%
₹9L – ₹12L15%
₹12L – ₹15L20%
Above ₹15L30%

⚠️ Important: Under the new regime, most deductions (80C, 80D, HRA, LTA) are not allowed, except:

  • ₹50,000 Standard Deduction

  • NPS (Employer’s contribution) – Section 80CCD(2)

  • Agniveer Corpus – Section 80CCH

Old vs New Regime – A Real Example

Case: Mr. Arjun (Age: 35)

  • Gross Salary: ₹9,00,000

  • Investments: ₹1.5L in PPF, ₹50K in NPS

  • HRA Exemption: ₹1L

  • Medical Insurance Premium: ₹25,000

Under Old Regime:

  • Deductions & exemptions reduce taxable income to ₹5,25,000

  • Tax before rebate: ₹17,500

  • Less: ₹12,500 rebate under 87A

  • Final Tax: ₹5,000 + 4% cess = ₹5,200

Under New Regime:

  • No deductions except standard deduction

  • Taxable income: ₹8,50,000

  • Tax: ₹40,000 + 4% cess = ₹41,600

➡️ Conclusion: Old regime is beneficial due to available deductions.

Step-by-Step Guide to File Your ITR Online

  • Visit: https://www.incometax.gov.in

  • Log in using PAN credentials

  • Navigate to e-File → Income Tax Return → File Now

  • Choose AY 2024–25, Individual, and Online Mode

  • Select the correct ITR Form (ITR-1 or ITR-2)

  • Verify pre-filled details using Form 16 and Form 26AS

  • Choose your tax regime (Old or New)

  • Enter eligible deductions if opting for old regime

  • Validate tax computation

  • Submit return and e-verify via Aadhaar OTP, Net Banking, Demat, or DSC

Important Deadlines & Penalties

ActionDue Date
Regular Return (Non-Audit Cases)1st July 2025
Belated Return Filing31st December 2025

Late Filing Fee (Section 234F):

  • ₹5,000 if income > ₹5 Lakhs

  • ₹1,000 if income ≤ ₹5 Lakhs

Final Checklist Before Filing

✅ Reconcile Form 16 with Form 26AS, AIS, and TIS

✅ Report all sources of income: salary, interest, capital gains, etc.

✅ Choose the tax regime carefully after benefit comparison

✅ File your return before the due date to avoid late fees and interest

Filing your ITR can seem overwhelming, but with proper understanding and timely action, you can sail through it smoothly. If in doubt, consult a Chartered Accountant or tax advisor to ensure accurate filing.

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