ITR Filing for Salaried Employees: All You Need to Know
Filing your Income Tax Return (ITR) is a crucial financial responsibility, especially for salaried individuals. While taxes are typically deducted at source (TDS), it’s still essential to file your ITR to report your income correctly, claim eligible deductions, and stay compliant with tax laws.
Whether you’re a first-time filer or a regular taxpayer, here’s everything you need to know about ITR filing for salaried employees for FY 2024-25 (AY 2025-26).
Who Should File ITR?
If your total income exceeds the basic exemption limit, you are legally required to file an ITR. But even if your income is below the exemption limit, ITR filing is beneficial for:
- Claiming tax refunds
- Establishing financial credibility
- Loan and visa approvals
- Carrying forward losses (such as capital losses)
Which ITR Form is Right for Salaried Employees?
- ITR-1 (Sahaj) – Applicable if your total income is up to Rs. 50 lakh and you earn from salary/pension, one house property, and other sources like interest income. Starting FY 2024-25, taxpayers can now report capital gains upto Rs. 1.25 lakhs in ITR-1 itself as capital gains upto this threshold are exempt from tax under section 112A.
- ITR-2 – Use this if your income exceeds Rs. 50 lakh, or you have taxable capital gains beyond the exempt limit, foreign assets, multiple house properties, or you’re a director in a company.
Benefits of Filing ITR for Salaried Individuals
Get Faster Refunds
If excess TDS has been deducted, you can claim a refund only by filing your return. Early filing ensures faster processing and refund disbursement.
Loan and Credit Card Approvals
Banks and lenders often ask for your last 2-3 years of ITR as income proof. A consistent ITR record boosts your eligibility for home loans, vehicle loans, and even credit cards.
Helps with Visa Applications
Several foreign embassies require ITR proofs to verify your financial standing before issuing visas, especially for long-term travel or work purposes.
Carry Forward Capital Losses
Filing ITR on time allows you to carry forward capital losses for up to 8 years, which can be adjusted against future capital gains.
Strict Scrutiny on Fake Deductions
The Income Tax Department has increased vigilance against salaried individuals claiming fake deductions, especially for HRA, LTA, and home loan interest. Many taxpayers have received notices for inflated or fictitious claims.
Avoid common pitfalls:
- Don’t fabricate rent receipts for HRA if you don’t pay actual rent
- Don’t claim LTA without valid travel proofs
- Claim only genuine deductions under Chapter VI-A
Filing an incorrect return may lead to scrutiny, penalties, and even prosecution under the Income Tax Act.
How to File ITR Easily with Tax2win?
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Self ITR Filing
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- Auto-selects the right ITR form
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Filing your ITR on time helps you stay financially responsible and legally compliant. With stricter scrutiny and evolving rules, it’s more important than ever to file correctly. File your ITR with the help of our CA services now!
