Navigating the Tax Return Landscape: Strategies for Taxpayers with Diverse Income Sources
Determining the appropriate ITR form is a crucial yet straightforward step for individuals with earnings from multiple streams, including freelancers and those juggling multiple jobs.
Filing an Income Tax Return (ITR) is a relatively seamless process for taxp with a single source of income. For instance, if your earnings solely come from a salary, you can conveniently handle the filing yourself through the e-filing portal of the Income Tax Department or various private tax filing platforms.
Nonetheless, many people have incomes from diverse sources such salaries, property rentals, business ventures, equity investments, cryptocurrency, lottery winnings, and more. Navigating the ITR filing process can be challenging for them, especially if they are unfamiliar with taxation terminology and the nuances of the various rules.
As the deadline for filing ITR for Assessment Year 2024-25 approaches, let’s explore some easy strategies that taxpayers with multiple income sources can follow to simplify the process.
Gathering Necessary Documentation:
If your income is derived from multiple sources, the first step before ITR filing is to assemble all the relevant documents in one place.
The tax documents you’ll need to file your return may include things like your Form 16, Form 26AS, AIS, TIS, bank statements, investment papers, capital gains records, and home loan statements. Reviewing these will give you a clear picture of all your sources and the taxes you’ve already paid in the financial year 2023-24.
Selecting the right ITR form is a crucial yet basic step, especially for individuals with multiple income streams, such as freelancers and people with additional jobs outside their regular hours. Choosing the wrong form can cause complications. There are seven ITR forms to choose from, depending on your sources of income. For instance, if you have both salary and capital gains income, you’ll need to file ITR-2. And if you also have business income, you’ll need to ITR-3.
It’s important to verify your Form 26AS, which provides details on the TDS and TCS paid in FY 2023-24. Ensure that any income with TDS deducted is not missed in your tax return. You can download your Form 26AS from the TRACES website.
