How to File Income Tax Return in India (2025 Step-by-Step Guide)

Filing your Income Tax Return (ITR) is not just a legal requirement; it is also a financial necessity for every responsible individual or entity earning taxable income in India. Whether you are salaried, self-employed, a business owner, or an investor, this guide will help you understand how to file your ITR correctly and confidently in 2025.

Who Must File Income Tax Returns?

You are legally required to file your ITR if

• Your annual gross total income exceeds ₹2.5 lakh (₹3 lakh for senior citizens aged 60–79, and ₹5 lakh for individuals above 80 years)

• You wish to claim a refund of excess TDS deducted from your salary, interest, or payments

• You have income from sources such as business, profession, capital gains, or foreign assets

• You are a company, LLP, or partnership firm, irrespective of profit or loss

• You have carried forward losses from previous years

• You have received income from cryptocurrency, virtual digital assets, or foreign investments

• You need to furnish proof of income for visa, loan, tender, or regulatory purposes

Documents Required to File ITR

Before starting the ITR filing process, keep the following documents ready:

• PAN card and Aadhaar card

• Form 16 issued by your employer

• Salary slips and annual salary breakup

• Interest certificates from banks and post office

• Form 26AS and AIS (Annual Information Statement) for TDS/TCS details

• Capital gains statement from stock brokers or mutual funds (if applicable)

• Proof of tax-saving investments (under sections like 80C, 80D, 80E, etc.)

• Home loan interest certificates

• Rent receipts for HRA claims (if applicable)

• Foreign income and asset details, if any

• Bank account details for refund credit

Understanding ITR Forms in 2025

There are different ITR forms applicable based on the nature of income:

• ITR-1 (Sahaj): For resident individuals with income up to ₹50 lakh from salary, pension, one house property, or interest

• ITR-2: For individuals or HUFs with capital gains, more than one house property, or foreign income

• ITR-3: For individuals or HUFs having income from business or profession

• ITR-4 (Sugam): For presumptive income taxpayers under Sections 44AD, 44ADA, or 44AE

• ITR-5: For partnership firms, LLPs, and associations

• ITR-6: For companies (except those claiming exemption under Section 11)

• ITR-7: For trusts, political parties, and charitable institutions

Choosing the correct form is essential for successful filing and to avoid notices.

Step-by-Step Process to File Income Tax Return Online

The e-filing process on the Income Tax Department portal is user-friendly and accessible. Follow these steps:

Step 1: Register/Login to the Income Tax e-Filing Portal

Go to https://www.incometax.gov.in and log in using your PAN/Aadhaar and password. If you are a new user, complete the registration process first.

Step 2: Choose “File Income Tax Return”

On the dashboard, select the “e-File” menu, then click on “Income Tax Return.” Choose the applicable assessment year (2024–25 for FY 2023–24).

Step 3: Select the Mode of Filing

Choose “Online” mode unless you are uploading a JSON file generated from third-party software. Select the appropriate ITR form as per your income type.

Step 4: Provide Basic Details

Confirm your name, PAN, Aadhaar, filing status (original or revised), and ITR form. Ensure all personal details are accurate.

Step 5: Fill in Income Details

Enter income from salary, house property, capital gains, and other sources. Refer to Form 16, AIS, and Form 26AS for accuracy.

Step 6: Declare Deductions

Enter details of deductions under Chapter VI-A such as:

• 80C (LIC, PPF, ELSS, etc.)

• 80D (Health insurance)

• 80E (Education loan interest)

• 80TTA/TTB (Interest from savings or senior citizen deposits)

• 80G (Donations)

Step 7: Compute Tax and Preview Return

The system will auto-calculate your tax liability or refund. Review your inputs carefully. Cross-check TDS claimed with Form 26AS.

Step 8: Submit and Verify the Return

Once satisfied, submit your ITR. You must verify it using one of the following:

• Aadhaar OTP (recommended)

• Net banking

• EVC through bank/Demat account

• Sending signed ITR-V by post to CPC, Bengaluru

Until your ITR is verified, it is not legally valid.

What Happens After You File Your ITR?

After submission and verification:

• You will receive an acknowledgment from CPC

• Your return will be processed by the Income Tax Department

• If eligible, refund will be credited directly to your bank account

• You may receive intimation under Section 143(1) confirming processing, refund, or errors

Keep checking your registered email and e-filing dashboard for updates.

Common Mistakes to Avoid

• Choosing the wrong ITR form

• Ignoring Form 26AS and AIS before filing

• Missing interest income from savings or FD

• Claiming incorrect deductions

• Failing to verify the ITR after submission

• Using incorrect bank details for refund

Benefits of Filing ITR

Even if not mandatory, filing ITR helps you:

• Build financial credibility

• Claim TDS refunds and avoid future scrutiny

• Establish income proof for loans or visas

• Carry forward capital losses

• Stay compliant with Indian tax law

Final Thoughts

Filing your income tax return is more than just a yearly obligation. It reflects your financial responsibility and ensures compliance with Indian tax laws. By understanding the process, choosing the right form, and filing on time, you avoid penalties and enjoy financial peace of mind.

To make the process even easier, we recommend estimating your tax liability beforehand.

You can use our free, professional tool:

Try Our Income Tax Calculator for 2025

Take time to prepare, keep your documents ready, and file your return before the due date. If you are unsure, consult a tax professional or advisor to ensure accuracy and compliance.