How to File ITR in India: A Beginner's Guide (AY 2026-27)

Filing your ITR for the first time is less scary than it looks. Most salaried filers can complete it in under 30 minutes once they know which form applies, where their data lives, and what the portal is actually asking. This guide walks you through the flow in the order you will encounter it.

Step 1: Check if you have to file

You must file if your gross income before deductions exceeds Rs 2,50,000 (basic exemption under the new regime it is Rs 3,00,000 as of current law, but always confirm the current-year threshold). Beyond that, you also must file if you have foreign assets, filed a loss you want to carry forward, paid electricity bills above Rs 1 lakh, deposited over Rs 1 crore in a bank account in the year, or spent over Rs 2 lakh on foreign travel.

Step 2: Pick the right form

• ITR-1 (Sahaj): Salaried, one house property, income up to Rs 50 lakh, no capital gains beyond LTCG under Section 112A up to Rs 1.25L. Most salaried filers.
• ITR-2: You have capital gains, foreign assets, RSUs/ESOPs, multiple house properties, or income above Rs 50L.
• ITR-3: Business or professional income (freelancers, consultants, doctors in private practice).
• ITR-4 (Sugam): Presumptive taxation under 44AD/44ADA/44AE — small business or freelance under Rs 50L.

Picking the wrong form is the single most common cause of defective-return notices. If in doubt, a 5-minute call with a CA on TrunkCall can save you a future 139(9) notice.

Step 3: Gather documents

• Form 16 from your employer.
• Form 26AS from the income tax portal (TDS statement).
• AIS (Annual Information Statement) — lists everything the department knows about your financial year.
• Bank statements, interest certificates, broker P&L if you have trades.
• Rent receipts, home loan interest certificate if claiming HRA or interest on housing loan.
• 80C investment proofs (ELSS, PF, life insurance, PPF).

Step 4: Reconcile Form 16 vs AIS

This is where beginners trip. AIS often shows data that is not in Form 16 — bank interest, dividends, mutual fund redemptions, broker-reported turnover. If you ignore AIS, the return will not match departmental records and you will get a notice.

Open both in parallel. Every income item on AIS needs to be in your return somewhere. If AIS shows something incorrect, flag it in the portal so it is on record.

Step 5: Choose old vs new regime

The new regime is the default. The old regime lets you claim deductions (80C, 80D, HRA, home loan interest). Calculate both on the portal — the one with lower tax is the one to file.

Step 6: File, verify, track

Submit the return. You then have 30 days to e-verify it — Aadhaar OTP is the fastest method. An unverified return is treated as if you never filed.

Common mistakes to avoid

• Forgetting to declare savings-account interest (most people have some).
• Missing dividend income (it is all taxable now at slab rates).
• Not declaring RSUs/ESOPs correctly — grant, vest, and sale all matter.
• Claiming HRA without filing rent receipts properly when landlord PAN is required.
• Using ITR-1 when you have capital gains that push you into ITR-2.