As the financial year 2024-25 draws to a close, it’s time to prepare for the upcoming Income Tax Return (ITR) filing season for assessment year 2025-26, which will begin on April 1.
To ensure you file your taxes smoothly and minimize your tax burden, chartered accountant Suresh Surana has recommended six key tasks to complete before March 31.
1. Finalize Tax-Saving Investments
If you’re opting for the Old Tax Regime, take full advantage of tax-saving opportunities available under various sections. Here are some important options:
Section 80C: Invest up to ₹1.5 lakh in instruments such as PPF, ELSS mutual funds, life insurance, home loan principal repayment, and 5-year FDs.
Section 80D: Deduct up to ₹25,000 (₹50,000 for senior citizens) on health insurance premiums.
Section 80G: Claim exemptions on donations made to charitable organizations.
Section 80CCD(1B): Claim an additional deduction of up to ₹50,000 for investments in the National Pension Scheme (NPS).
2. Provide Proof of Tax Deductions to Your Employer
If you’re a salaried employee, submit all necessary tax-saving proof (such as for 80C, 80D, home loan interest, etc.) to your employer by March 31.
This ensures that your employer deducts the correct TDS, preventing any surprises when filing your taxes.
3. Adjust Your TDS/Tax
If there have been any changes in your income, deductions, or exemptions during the year, inform your employer or the TDS deducting authority as soon as possible.
This will ensure that your tax liability is correctly assessed, avoiding any underpayment or overpayment of taxes.
4. Pay Advance Tax (if applicable)
If your tax liability is over ₹10,000, you must pay advance tax before March 31. Failing to do so may result in interest charges under sections 234B and 234C. Ensure that this is taken care of on time to avoid penalties.
5. Plan for Capital Gains Tax
If you’ve made investments in stocks, mutual funds, or property, it’s important to understand how capital gains tax works. Also, look into options for carrying forward losses to future years.
You can even use tax-loss harvesting to offset your capital gains by selling investments at a loss, which can help reduce your taxable income.
6. Match Data with Form 26AS, AIS, and TIS
Before filing your ITR, review your Form 26AS, AIS, and TIS to ensure that all your TDS, advance tax, and self-assessment tax payments are accurately reflected.
If you spot any discrepancies, take corrective actions immediately to avoid mismatches during ITR filing.
