Filing income tax returns in India can be a daunting task, especially for those who are starting a business for the first time. With the introduction of GST returns and TDS, there are several additional compliance requirements that businesses need to be aware of. In this blog, we will take a look at some best practices for filing income taxes in India and how you can benefit from hiring an e-filing expert today. We will also cover how there are some quick tips you can keep in mind if you want to really save income tax and benefit from the same in a realistic way.
Here are some quick points to begin with having the best regime of maintaining a good financial well-being and at the same time file income taxes the best way as a growing individual in India.
Keep Track of Your Income
The first step in filing your income tax return is to keep track of your income throughout the year. Make sure you have all the necessary documents, such as salary slips, bank statements, and receipts for any investments made. You can use accounting software or spreadsheets to keep track of your income and expenses. This will make it easier to file your tax return accurately and avoid any mistakes.
Know Your Tax Deductions
There are several tax deductions available to taxpayers in India. These include deductions for investments made in certain schemes such as Public Provident Fund (PPF), National Pension System (NPS), and Equity Linked Savings Scheme (ELSS). You can also claim deductions for payments made towards life insurance premiums, medical expenses, and education fees for your children. It is important to know these deductions so that you can reduce your taxable income and save money on your taxes.
File Your GST Returns on Time
If you are registered under the Goods and Services Tax (GST), you are required to file regular returns. GST returns must be filed on a monthly or quarterly basis, depending on the turnover of your business. It is important to file your returns on time to avoid penalties and interest charges. Make sure you keep accurate records of all your sales and purchases to make the filing process smoother.
Be Aware of TDS Provisions
Tax Deducted at Source (TDS) is a mechanism by which the government collects tax at the source of income. If you are a business owner, you may be required to deduct TDS from payments made to your vendors or employees. It is important to be aware of the TDS provisions and make timely payments to avoid penalties.
Hire an E-Filing Expert
Filing income tax returns can be a complex process, especially if you are a business owner. Hiring an e-filing expert can help you navigate the tax filing process and ensure that your returns are filed accurately and on time. An e-filing expert can also help you take advantage of all the tax deductions available to you and save money on your taxes.
So How Can you Save Taxes?
The government promotes the investment of citizens in tax-saving SCHEMES mentioned under section 80C of the Income Tax Act in order to reduce their tax burden. In this way, one can make sure you have some sort of investment and not worry about spending excessive money on paying taxes. Here are few instances of tax-saving instruments:-
Public Provident Fund: This is a tax-saving investment option encouraged by the government where individuals can deposit money for a fixed period of time and earn a fixed interest rate.
National Pension Scheme: The government promotes this tax-saving investment plan for individuals to secure their retirement years by investing a portion of their income in this scheme.
Premium Paid for Life Insurance policy: To decrease their tax liability, taxpayers can pay premiums for life insurance policies and get tax benefits through the section 80C of Income Tax Act.
National Savings Certificate: This is a tax-saving investment scheme where individuals can invest a fixed amount of money and earn an interest rate that is compounded annually.
Equity Linked Savings Scheme: This is a type of mutual fund investment where individuals can invest their money in equity and get maximum tax benefits under the income tax act.
Home loan’s principal amount: Individuals can claim tax benefits on the principal repayment of their home loan under the section 80C.
Fixed deposit for five years: This is a tax-saving investment option where individuals can invest their money in fixed deposits for a period of five years and get tax benefits under section 80C.
Sukanya Samariddhi account: This is a tax-saving investment scheme for the benefit of the girl child where parents can invest in this account and get tax benefits under section 80C of the income tax act.
Children’s tuition fees: Parents can claim tax benefits on the tuition fees paid for their children’s education under section 80C of the income tax act in India.
Filing income tax returns in India requires careful planning and preparation. By keeping track of your income, knowing your tax deductions, filing your GST returns on time, being aware of TDS provisions, and hiring an e-filing expert, you can ensure that your tax filing process is seamless. If you have any further questions about filing your taxes, feel free to leave a comment below.