The Ultimate Tax Checklist: What You Need to Do Before 31st March in India

As the financial year comes to a close, it’s time to prepare for tax season. Whether you’re salaried, self-employed or running a business, organizing your finances now can help you save big.

We are here with a practical tax checklist India to help you maximize your income tax deductions and minimize your tax income liability before the 31st of March.

1. Review Your TDS and Advance Tax Payments

• TDS Compliance: Check your Form 26AS/AIS income tax website to ensure all tax deductions have been correctly credited against your PAN. If there are any discrepancies, get them corrected.

• What is the last date to pay advance tax in India?

If your tax liability exceeds ₹10,000, you must pay advance tax in India. The last installment is due by March 15^th to avoid penalties.

2. File the ITR-U

Ensure to file your return, especially the ITR-U to correct any mistakes from previous filings. This is your last chance to report missed income or deductions for AY 2022-23 (FY 2021-22).

3. Tax tips for salaried individuals before 31st March 2025

• Submit Form 12BB: It is statement by an employee for deduction of tax to declare the investments that they have made during the year. Failure to submit these can lead to higher tax withholding and which can only be refunded during tax filing. Salaried individuals can file their own return.

• Claim reimbursements: Submit proof for tax-exempt reimbursements like medical, LTA, HRA and telephone expenses.

• Rent Payments and HRA: If you live in a rented property, you can claim House Rent Allowance (HRA) under Section 10(13A). To maximize this, ensure you have valid rent receipts and your landlord’s PAN details if your rent exceeds ₹ 1 lacs per year. For those who don’t receive HRA, a deduction of up to ₹5,000 per month is available under Section 80GG, provided you meet the eligibility criteria.

4. Gather All Your Documents

You need to have all the necessary documents in hand for making tax-saving decisions. This includes:

1. Form 16: If you’re salaried, your employer will provide this form, showing the TDS (Tax Deducted at Source) on your salary.

2. SFT transactions: Also verify if the SFT transactions such purchase or sale of immovable property above ₹ 30 Lakhs are reflected in the AIS or not.

3. Investment Proofs: Gather receipts for your investments under Section 80C, 80D and other tax-saving sections.

4. Other Income Proofs: Keep all supporting documentation handy like rental property, freelance work, or capital gains (like rental agreements, capital gain statement or transaction records).

5.  How to save tax before 31st March?

A. Maximize Your Section 80C Deductions

Section 80C allows deductions by investing in specific instruments, with a maximum deduction of ₹ 1.5 lakh. Invest in PPF, ELSS funds, and life insurance premiums to claim deductions.

Moreover, there is also an additional ₹50,000 deduction available under Section 80CCD(1B) over and above the ₹1.5 lakh limit under 80C by investing in NPS before March 31st.

If you have not invested in any of these, check out the New or Old Tax Regime guide to choosing wisely.

B. Don’t Miss Out on Section 80D

Health insurance is one of the most valuable deductions you can claim under Section 80D. The government allows a deduction of up to ₹25,000 for premiums paid for yourself, your spouse and dependent children. If your parents are senior citizens, you can claim up to ₹50,000 for their health insurance premiums.

Preventive Check-ups: If you’ve made payments in cash or online for preventive health check-ups, make sure they’re included as well, as they’re eligible for deduction under the same section.

C. Tax Benefits for Home Loan Borrowers on Loan Interest (Section 24)

If you’ve taken a home loan, Section 24 allows you to claim up to ₹ 2 lacs per year on the interest paid towards your home loan. This can be a substantial deduction, so ensure you’ve made all interest payments up to March 31^st on your home loan.

D. Education Loan Deductions (Section 80E)

For those who’ve taken education loans, Section 80E offers an excellent tax break. The best part? There’s no upper limit on the amount you can claim for interest payments. The deduction is allowed for the entire interest amount paid on your loan and this benefit is available for up to 8 years. Ensure you have the interest certificates from the financial institution that issued the loan, showing how much interest was paid during the financial year ending 31st March 2025.

E. Donations to Charitable Causes

If you’ve made donations to charitable organizations, you can claim deductions under Section 80G. These donations not only help you contribute to causes you care about but also reduce your tax liability. Ensure you have receipts and the necessary details, including the organization’s registration number and donation certificate, to claim these deductions.

6. What Businesses should do before 31st March 2025?

• TDS and TCS Compliance

Ensure TDS is deducted and deposited correctly and reconcile with Form 26AS. Beware to comply with TCS provisions under Section 206C(1H) on sale of goods if turnover exceeds ₹10 crore.

• Section 43B(h) Compliance:

If the payment to small businesses (MSME) is not made within this 45-day period, businesses cannot claim deductions for these payments in their income tax returns for that year. Thus, make payment before 31^st March 2025.

• Tentative Financial Statements

Review and prepare your tentative annual profit & loss account and balance sheet to compare it with previous year and budgeted figures for the current year to plan better for taxes.

• Account Reconciliation

Ensure Proper Reconciliation: Make sure that all TDS and TCS credits are reconciled in your books and correctly accounted for in the financial statements.

7. Plan for the Next Financial Year

As you prepare to close out this financial year, take some time to plan for the next one:

• Review Tax-Advantaged Investments: If you’re looking to save more in the coming year, research about starting tax-saving investments early mentioned our income tax guide. This will give you time to plan and invest wisely especially the Non-resident individuals.

• Salary and Bonus Adjustments: If you expect any changes in your income for the upcoming year, such as a salary hike or bonus, rework your tax planning accordingly.

8. Consult a Tax Professional

While many of the tax-saving steps above can be done independently, consulting with an income tax professional can help you avoid mistakes and ensure you’re making the most of the available tax benefits. If you have a complex financial situation, like multiple sources of income or investment portfolios, professional advice can save you time and money.

Afterword

By following this tax checklist, you can maximize your deductions and minimize your tax liability before the 31st March deadline.

Whether you are a salaried employee, self-employed, or a business owner, taking proactive steps today can make tax season stress-free. Start planning for tax-saving investments now and consider consulting with a tax expert to ensure you’re optimizing your returns. Stay ahead of potential changes in tax laws for 2025 by reviewing new budget proposals and financial strategies.

Learn more about tax-saving strategies for 2025. Consult Master Brains’ tax experts today!