Once you have filed your income tax return (ITR), the next step is to verify it. An investor with a demat account can use it to verify their ITR, which is similar to a bank account based ITR verification. You also need to pre-validate your demat account to verify the tax return.
If you’re wondering how to open a demat account, then you must contact a depository participant. The Income Tax Department processes the ITR after it is verified, and gives the option of verifying the return either physically or electronically.
Let’s take an in-depth look at how an investor can file a return using a demat account.
E-Verification Of ITR-V Through EVC
There are mainly five ways in which an investor can e-verify their ITR at the Income Tax department’s e-filing portal. For each method, you must generate an Electronic Verification Code (EVC), which is used to verify the tax return online.
Different options for generating EVC:
- EVC generation through a demat account
- EVC generation through aadhaar card
- EVC generation through bank account details
- EVC generation through ATM
- EVC generation through email id and mobile number
There are two methods to verify Income Tax Return:
- Download the form and send ITR-V to CPC for physical verification
- ITR-V through the generation of EVC for online verification
If you are not able to e-verify the return, then you can download the return filing acknowledgement i.e. ITR V, print it, sign it and post the same to CPC, Bangalore for processing the return. Moreover, if you are filing a paper return (in case you are unable to file your return online), you may need to sign your return of income for verifying it and present the same in the office of the jurisdictional income .
E-Verification Of ITR With Pre-validated Demat Account
The pre-validation method is automated and generally takes about one to two hours, and in the event of an error, you will be notified via email. An investor can use their demat account to generate EVC only after validating it with the depository. Simply go to ‘Generate EVC’ option and select ‘Generate EVC through demat account number.’ Next, enter the EVC that you received on your registered mobile number to verify your ITR.
You must have linked your e-filing account with your demat account. The option to link the same is available under Profile Settings > Pre-validate demat account after login to the e-filing portal. Without performing the verification of your ITR, your ITR will not be processed by the Income Tax department. Post-filing the ITR, an investor gets 120 days to verify it.
Steps For E-Verification
You can verify your ITR by presenting demat account details such as email ID, mobile number, DP and client ID, and depository type on the tax portal.
Step 1: Login to your account at the e-filing portal and go to e-file tab present on the dashboard. Click on it and scroll through the drop-down menu and select the ‘Upload Return’ as an XML file.
Step 2: After uploading the return and pressing submit, you will see a page with four choices on the e-verify return page. Select option 2, which would say that you don’t have an EVC and would like to generate the EVC to e-verify the return.
If your salary is below five lakhs and you don’t refund claims, then you will view a screen with four distinct ways of generating a fresh EVC. If your salary is five lakhs or more or if you have refund claims of Rs 100 or more, you will view a screen with three different ways of generating a fresh EVC.
In either of the case, simply click on EVC – Through Demat Account Number.
Step 3: Click on the pre-validate your demat account tab and you will be forwarded to the demat details page. Once you’re on the page, fill in the details accordingly and click pre-validate.
Step 4: You will receive a message of successful validation, and the following pop-up will be displayed at your screen, “Click on Yes to generate EVC.” Once you click on it, you will get another success message, and you need to enter the code received on your SMS.
Step 5: Enter the EVC in the pop-up and click submit to e-verify the return. If verification is successful, you will see an acknowledgement message on your screen.
Step 6: Download the acknowledgement and save it.
No additional action is required, you have successfully filed your return through a demat account.
E-verification with an electronic verification code (EVC) is useful as you can do away from signing and sending a hard copy of the return filing document. Moreover, e-verification also assists your return getting processed much faster as compared to the other mode of verification, i.e., physically sending the document.