Income Tax Filing Basics for First-Time Salaried Employees

Your first income tax return can feel more intimidating than it needs to be, mostly because the terminology — Form 16, regimes, deductions, TDS — gets thrown around without much explanation. For a salaried employee with a fairly standard income structure, the actual process is more mechanical than it first appears.

Start With Form 16

Your employer issues Form 16 after the financial year ends, summarising your salary, the tax already deducted at source (TDS), and any deductions your employer accounted for during the year. This single document contains most of what you need to fill in your return, since it breaks down your salary into taxable components and shows exactly what's already been paid to the government on your behalf.

If you changed jobs during the financial year, you'll have a Form 16 from each employer, and you'll need to combine the income from both when filing — a step that's easy to miss and a common reason first-time filers under-report income without realising it.

Old Regime vs New Regime

India currently allows salaried taxpayers to choose between two tax regimes each year: the old regime, which has higher tax rates but allows a wide range of deductions and exemptions (like HRA, 80C investments, and health insurance premiums), and the new regime, which has lower rates but very few deductions available.

There's no universally better choice — it depends on how much you're actually claiming in deductions. As a rough starting point: if your combined deductions (HRA, 80C investments like PF and ELSS, home loan interest, health insurance premium, and similar) add up to a substantial portion of your income, the old regime often works out better. If you have few or no such deductions, the new regime's lower rates frequently result in a lower tax outstanding. Running the calculation both ways before filing — most filing portals let you preview both — is the most reliable way to decide rather than guessing.

Common Deductions Worth Checking (Old Regime)

• Section 80C — covers PF contributions, ELSS mutual funds, life insurance premiums, PPF, and children's tuition fees, up to the specified annual limit.
• Section 80D — health insurance premiums for yourself and family, with a higher limit if it includes senior citizen parents.
• HRA (House Rent Allowance) — if you pay rent and receive HRA as part of your salary structure, a portion may be exempt based on your rent, salary, and city of residence.
• Home loan interest — deductible under a separate section if you have an ongoing home loan, subject to specified limits.

Filing Step by Step

1. Gather Form 16 (or Form 16s, if you had more than one employer), bank interest certificates, and details of any other income (freelance work, rental income, capital gains).
2. Log in to the income tax department's official e-filing portal using your PAN.
3. Select the correct ITR form — most salaried individuals without business income or capital gains use a simpler form, while those with additional income sources need a more detailed one.
4. Much of your salary and TDS data may already be pre-filled from your employer's reporting — review it carefully against your Form 16 rather than assuming it's automatically correct.
5. Choose your regime for the year, enter any deductions not already reflected, and let the portal calculate your final tax liability or refund.
6. Submit and complete e-verification, typically via Aadhaar OTP, which finalises your filing — an unverified return is treated as not filed at all.

Mistakes That Commonly Trigger Notices

• Forgetting to report income from a previous employer after switching jobs mid-year
• Not reporting interest earned on savings accounts or fixed deposits, which is taxable and often visible to the tax department through bank reporting
• Claiming deductions without the supporting proof actually being valid or current (e.g., an expired health insurance policy)
• Filing under the wrong ITR form for your actual income sources

After Filing

Keep the acknowledgement (ITR-V, if not e-verified immediately) and a copy of your filed return accessible, since it's frequently needed for loan applications, visa processing, and other financial verification well beyond the tax season itself.

Filing your first return is largely a matter of gathering the right documents and understanding which regime suits your specific deduction profile — the mechanics of the portal itself are more straightforward than most first-time filers expect once those two pieces are in place.