How to fill details of Salary in ITR-1 for FY 2018-19 or AY 2019-20

How to fill details of Salary in ITR-1 for FY 2018-19 or AY 2019-20

How to fill details of Salary in ITR-1 for FY 2018-19 or AY 2019-20 

ITR-1 is amongst the most broadly utilized forms by the salaried people to file their income tax return (ITR). The form is currently available on the income tax department's e- filing site. Consequently, an individual could without any difficulty file the ITR once your employer gives you Form-16 for Financial Year 2018-19. 

Not just is ITR-1 different from the previous year, even Form-16 has undergone changes this year. According to a notification issued through the Central Board of Direct Taxes (CBDT), the new format of Form-16 would have detailed information. This incorporates detailed break-up of tax-exempt allowances paid towards the employees by your employer and deductions from salary income claimed by the employee and declared to your employer.

However, in contrast to the previous year, employees don’t need to collect pay slips as ITR-1 and Form 16 is currently synchronized, making it simpler to fill in your details.
Here is all that employees must know regarding filling your salary details in ITR-1 for Financial Year 2018-19.

This year, ITR1 needs details of salary income to be provided under four sub-heads as follows:

  • Gross salary.
  • Allowances to the extent exempt under section 10.
  • Net salary (a-b).
  • Deductions under section 16.

When every one of the data is entered by the employee under the four sub-heads as mentioned over, the fifth sub-head, i.e., 'Income chargeable under the head Salaries', shall be automatically calculated.

Here we look at each head in detail:

A) Gross salary

This head is additionally divided into 3 parts: 

  • Salary as per section 17(1).
  • Value of perquisites as per section 17(2) .
  • Profits in lieu of salary as per section 17(3).

The information requisite in ITR-1 could be found in Part-B of Form-16. 
Part-B of Form-16 begins with the head 'Gross Salary'. The break-up provided under this head, 'Gross Salary', is the same as what is asked in ITR-1. The employee is just required to copy and enter the information in ITR-1. 
B) The Allowances to the extent exempt under section 10 

This head holds information regarding the partially or fully tax-exempt allowances received from the employer, for example, house rent allowance (HRA) and leave travel allowance (LTA). In the form ITR-1, in this section, you need to fill the information of those allowances that are fully or partially tax-exempt. This information shall be available in Part-B of Form-16under the head 'Allowances to the extent exempt under section 10'. To comprehend which of the allowances you get would reflect under 'Allowances to the extent exempt under section 10', you have to know whether the allowances received by you according to your pay structure are either partially or fully taxable. For instance, the dearness allowance (normally received by government workers) is completely taxable. In the event that an allowance is fully taxable, at that point it would be added to the salary according to section 17(1).

Then again, HRA could be fully taxable if you are not living on a lease or have not paid any lease. In any case, in the event that you have paid lease for living in a rented place, at that point a part of HRA received by you could be tax-exempt if you fulfill the conditions indicated.

This could be clarified with an example. Suppose, in Financial Year 2018-19, the employer has paid the employee Rs 1.2 lakh as HRA. However, out of this, the employee has paid just Rs 96,000 as yearly rent to your landowner. Rules administering HRA would decide the tax-exempt portion of the total HRA the employee has received during the year. For example, let assume that according to the rules, Rs 72,000 of HRA is tax exempt and Rs 48,000 is the taxable portion.

The sub-head 'Allowances to the extent exempt under section 10' in Part B of your Form 16 would show the tax-exempt portion of HRA, that is, Rs 72,000. This figure of Rs 72,000 is required to be copied and entered in the column with the same name in ITR-1 by choosing it from the drop-down menu. The drop-down menu has 14 options and a taxpayer is required to select and mention every tax-exempt allowance received as mentioned in Form-16. 

C) Net Salary 

When an employee has entered the details in the above-mentioned heads, at that point the ITR software shall automatically calculate your net salary. This sum should match with the net salary mentioned in your Form 16.

D) Deductions under section 16 

Once the net salary is calculated, the employee needs to claim the deductions. Unlike the commonly known deductions, for example, those under section 80C, section 80D, etc, on, deductions under section 16 must be claimed in the event that you have salary income or pension. These deductions are:

  • Standard deduction of Rupees 40,000/-
  • Entertainment Allowance.
  • Tax on employment/professional tax.

These deductions shall be mentioned in Part-B of your Form-16. Standard deduction of Rs 40,000 would be available to the employee for Financial Year 2018-19. Deduction on entertainment allowance received is only available to government workers. If the employee has paid any professional tax to the state government, at that point the tax amount paid could be claimed as a deduction.

Click here to read more about "The new changes in the Income Tax Return Forms"

E) Income chargeable under the head 'Salaries' 

When every one of the details is entered, at that point the figure corresponding towards 'Income chargeable under the head Salaries' shall automatically be calculated by the ITR software. This auto- calculated figure must match with the sum mentioned in your Form-16.


eStartIndia Team

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