Future Generali

Filed my income tax return; what comes next?

Filing Income Tax Returns (ITR) on time, according to an individual’s tax liability, is a mandatory provision of law. Failure to file income tax returns could result not only in the income tax department issuing notices but also in the following action. Filing ITR returns also becomes mandatory if one wants to apply for a bank loan, credit card, and for proceedings involved in getting VISA approval for a foreign country.

With the government digitizing the filing of ITRs, the entire process has become more convenient and faster. Along with the ease of use, e-filing has resulted in enhanced confidentiality and better access to one’s past tax records. But it would help if you remembered that your tax liability does not end merely by filing the income tax returns. There are a few more steps to be completed before the entire procedure is deemed to be successful.

Here is a list of the steps post filing of ITR:

Step 1: Acknowledgement -- The income tax department generates acknowledgment known as ITR-V. This is sent to the email address provided by the individual tax-payer. The department usually mails ITR-V in two or three days. If one does not receive the document, it can be downloaded from the e-filing website. Once you submit the details, the ITR-V form would be available.

Step 2: Sign and submit the ITR-V form/ e-verify your filed return-- After downloading and printing the form, you need to sign it and post it to the Central Processing Centre of the income tax department at Bangalore. You must always remember to post the form within 120 days of filing the ITR. Alternatively, for instant e-verification, you can use Electronic Verification Code (EVC) using your net banking, bank account, Demat account, ATM, the email id/mobile number or Aadhar card. In all cases, you must remember to verify the returns, failing which the income tax department will not process the filed returns, and it would be deemed as invalid.

Step 3: The return is processed by the income tax department: Once an income tax return is successfully verified, the income tax department provides intimation to the individual tax-payer. The intimation, generated under Section 143(1) of the Income Tax Act, 1961, analyses the demand of the department vis-a-vis the details provided in the ITR. Based on the computation of the demand as compared to the filed returns, the department intimates the tax-payer in three different methods:

No demand No refund: This intimation means that neither any further interest/tax is found payable by the individual, nor is the department liable to refund/return any excess tax paid. This intimation also means that the individual has no further tax liability for the particular financial year.

Refund payable: There can be cases where the tax-payer has paid excess tax than the actual tax liability through advance tax or tax deduction at source. In such cases, the department initiates the process for a refund. The refund is usually credited directly to the individual’s bank account.

Demand determined: In this scenario, the department intimates the tax-payer that a particular amount of tax or interest is still payable by the individual. You must pay the tax demand by the department within the specified time period. If required, you can file for a rectification.

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