Table of Contents

1. Overview & Key Updates for AY 2025-26
2. ITR-1 Eligibility: Who Can File?
3. Why File a Nil ITR?
4. Essential Documents & Data Checklist
5. Step-by-Step E-Filing Process
6. Old vs. New Tax Regime Comparison
7. Self-Assessment & Tax Payments
8. Claiming & Tracking Refunds
9. Expert Tips to Avoid Errors & Delays
10. Frequently Asked Questions (FAQs)
11. Conclusion & Next Steps

1. Overview & Key Updates for AY 2025-26

The Income Tax Department has extended the deadline to September 15, 2025 for Assessment Year 2025-26 due to significant updates in tax laws and compliance requirements. Whether you are a seasoned filer or approaching e-filing for the first time, staying abreast of these changes will help you navigate the process confidently.

1.1 Introduction to Changes in ITR Forms

For AY 2025-26, the following major revisions have been introduced:

• Standard Deduction: Increased to ₹75,000 for salaried individuals and pensioners, aligning with broader relief measures.
• Capital Gains Reporting: Detailed schedules now require breakdowns by asset class (equity, debt, real estate) and holding period.
• Enhanced Investment Disclosures: Specific sections for declaring Section 80C, 80D, 80CCD, 80G, and other deductions with granular data entry.
• Form 16 Format: Employers must now provide separate annexures for exempt allowances, perquisite valuations, and employee stock option details.

1.2 Why These Updates Matter

These changes aim to increase transparency and reduce discrepancies between employer-provided data and taxpayer declarations. Accurate reporting helps the IT Department streamline processing and minimizes notices and inquiries, thereby reducing taxpayer burden.

1.2.1 Impact on Salaried Individuals

Salaried employees must pay attention to the new disclosure requirements, especially if they receive additional benefits such as rent-free accommodation, company car, or stock options. Proper categorization and reporting prevent misalignment with Form 26AS data and limit potential notice triggers.

1.2.2 Alignment with International Standards

The updated forms mirror global best practices in tax reporting, including clear segregation of income heads, standardized deduction sections, and digital-first compliance checkpoints. This raises India’s tax administration to par with leading jurisdictions.

2. ITR-1 Eligibility: Who Can File?

2.1 Detailed Eligibility Criteria

Before you begin filing, ensure you meet all ITR-1 criteria:

• Residence Status: Must be a resident Indian citizen or resident under Hindu Undivided Family (HUF).
• Income Heads: Income solely from salary/pension, one house property (let out or self-occupied), and other sources excluding lottery, race winnings, or speculative business.
• Investment Limits: No need to worry about foreign income, agricultural income exceeding ₹5,000, or business profits.

2.2 Who Should Choose ITR-2, ITR-3, or ITR-4

If you do not qualify for ITR-1, consider these forms:

• ITR-2: For individuals with income from capital gains, more than one house property, foreign assets, or total income above ₹50 lakhs.
• ITR-3: For individuals with income from business or profession, including freelancers and consultants.
• ITR-4 (Sugam): For individuals and HUFs opting for presumptive taxation under sections 44AD/44ADA, with total income under ₹50 lakhs.

2.3 Exclusions and Common Pitfalls

3. Why File a Nil ITR?

Filing a nil return might seem redundant if your taxable income is zero, but it offers significant advantages:

3.1 Claiming Refunds

Often, employers or banks deduct TDS on salary or interest income even if your tax liability is nil. By filing, you can claim these excess deductions back.

3.2 Maintaining Compliance Record

An ITR filing record is a proof of compliance that banks, visa offices, and other authorities may require. It strengthens your credibility in financial transactions.

3.3 Carry Forward Losses

If you have capital losses or business losses, filing allows you to carry these forward to set off against future gains, reducing your tax liability in subsequent years.

3.4 Avoiding Notices

Non-filing can sometimes trigger automated notices from the IT Department, even if no tax is due. A filed nil return prevents unnecessary correspondence.

4. Essential Documents & Data Checklist

Gathering all necessary documents beforehand ensures a smooth and error-free filing. Use the checklist below:

1. Form 16: Employer-issued certificate detailing salary breakup, exemptions, and TDS.
2. Form 26AS: Consolidated tax credit statement from TRACES showing TDS, TCS, and other payments.
3. AIS: Annual Information Statement summarizing high-value transactions.

   Tip: Download AIS under “Compliance” to cross-verify transactions above ₹2 lakhs reported by banks or mutual funds.

4. Bank Statements: For interest income, dividend credits, and other miscellaneous income.
5. Investment Proofs: Receipts for ELSS, PPF, NSC, life insurance premiums (Sec 80C), health insurance (Sec 80D), NPS contributions (Sec 80CCD).
6. Home Loan Documents: Interest certificate from lender for Section 24B deduction and principal repayment proof under Section 80C.
7. Policy Receipts: Medical insurance and preventive health check-up bills.
8. Aadhaar & PAN: Valid OAuth proof for e-KYC and filing validation.
9. Bank Account Details: IFSC and account number for refund processing.

5. Step-by-Step E-Filing Process

Follow these detailed steps to complete your ITR-1 filing accurately:

5.1 Login or Register on Income Tax Portal

Procedure:

1. Visit https://www.incometax.gov.in.
2. Click on “Login” and enter your PAN, password, and captcha code.
3. Validate via OTP sent to your registered mobile/email.
4. If new, select “Register” and complete the profile setup with Aadhaar OTP verification.

5.2 Verify Pre-Filled Data

Upon login, the portal pre-fills certain fields. Carefully verify:

• Name, PAN, date of birth, and contact details.
• Bank account details for refund (validate with OTP).
• Previous year’s ITR acknowledgement status.

5.3 Download and Cross-Check Form 26AS

Steps:

1. Navigate to “My Account” → “View Form 26AS”.
2. Select Assessment Year 2025-26, choose HTML view.
3. Export as PDF or download in text format.

   Important: Ensure TDS entries match with Form 16 and AIS to avoid mismatches.

5.4 Start Filing ITR-1 Online

1. Navigate: e-File → Income Tax Return → File ITR Online → Continue.
2. Select AY: 2025-26 and ITR-1 Sahaj.
3. Regime Choice: Choose New or Old regime based on deductions.

5.5 Enter Income Details

Fill each section precisely:

• Salary Income: Copy from Form 16. Include basic pay, allowances, perquisites.
• House Property: Self-occupied or let-out. Enter municipal taxes paid, interest, principal.
• Other Sources: Bank interest, dividend, family pension. Exempt income entered separately.

5.6 Claim Deductions

Old Regime Deductions:

• Section 80C: Up to ₹1.5 lakh (PPF, ELSS, NSC, principal repayment)
• Section 80D: Health insurance premiums (self, family, parents)
• Section 80CCD(1B): Additional NPS deduction of ₹50,000
• Section 80TTA/80TTB: Savings account interest up to ₹10,000 (senior citizens ₹50,000)

New Regime Deductions:

• Standard Deduction: ₹75,000
• Employer’s NPS contribution: Section 80CCD(2)

5.7 Review Tax Computation

The portal auto-computes tax liability. Verify:

• Tax before cess and surcharge.
• Health and education cess (4%).
• Total tax paid via TDS, advance tax, self-assessment tax.

5.8 Preview & Submit Return

1. Click “Preview” to view summary.
2. Resolve errors (highlighted in red).
3. Click “Submit ITR” and confirm submission.

5.9 E-Verification Options

• Aadhaar OTP (registered mobile linked)
• Netbanking/EVC via pre-validated bank account
• Demat account EVC
• Send signed ITR-V to CPC Bangalore within 120 days

6. Old vs. New Tax Regime Comparison

Selecting the right tax regime can save you significant amounts. Compare:

Pro Tip: Use the Income & Tax Calculator on the e-filing portal to simulate both regimes.

7. Self-Assessment & Additional Tax Payments

If computed tax liability exceeds total TDS & advance tax, pay the difference as self-assessment tax:

1. Navigate: e-File → Pay Tax → New Payment
2. Select Self-Assessment Tax for AY 2025-26
3. Enter due amount and PAN
4. Choose payment method (Netbanking, UPI, Card)
5. Complete transaction and download challan

Always retain the challan receipt as proof of tax payment for future reference or audits.

8. Claiming & Tracking Refunds

8.1 Refund Processing Timeline

Once e-verified, refunds are typically processed within 2-4 weeks. Complex cases may take up to 6 weeks.

8.2 How to Track Refund Status

1. Login → My Account → Refund/Demand Status
2. Enter PAN and assessment year
3. View status and expected credit date

8.3 Common Refund Delays & Remedies

• Mismatch in bank details: Validate IFSC/account via OTP during filing.
• Pending verification: Use immediate e-verification; avoid sending ITR-V physically late.
• High-value refunds: May require manual review; respond promptly to CPC notices.

9. Expert Tips to Avoid Errors & Delays

• Start early: Avoid portal slowdowns near deadlines.
• Cross-verify: Ensure consistency between Form 16, 26AS, AIS.
• Document backups: Keep digital and physical copies for 6 years.
• Use pre-validated bank details: Minimizes refund rejection risks.
• Review past notices: Address previous compliance issues proactively.
• Consider professional help: For complex investments or foreign income.

10. Frequently Asked Questions (FAQs)

1. Can I revise my ITR after e-filing?

Yes, file a revised return under Section 139(5) before the original due date.

2. Missed the September 15 deadline?

Belated return possible until December 31, 2025 with ₹5,000 late fee.

3. How to rectify mistakes post e-verification?

Submit a revised return; original e-verified return cannot be withdrawn.

4. Is Form 16 mandatory?

Recommended for accuracy but not mandatory; aggregate salary/TDS yourself if unavailable.

5. What is the penalty for non-filing?

Late fee up to ₹10,000 under Section 234F, interest under Section 234A.

6. How long to retain ITR documents?

Maintain records for at least 6 assessment years as per Section 44AA.

11. Conclusion & Next Steps

By following this master guide, you will be equipped to file your ITR-1 accurately, optimize tax savings, and maintain a robust compliance record. Key takeaways:

• Start the e-filing process early to avoid last-minute rush.
• Select the correct ITR form based on your income sources.
• Compare old vs new regimes using the portal’s calculator.
• Gather all documents and verify data meticulously.
• E-verify promptly to expedite refund processing.

Ready to File? Log in to the e-filing portal, use this guide as your companion, and submit your ITR-1 well before September 15, 2025.