Income tax filing software is software that fills in and files a person's income tax return (ITR) for them. In India, the return is filed on the Income Tax Department's e-filing portal. Most salaried employees must file by 31 July each year. Some of these products also help salaried employees pay less tax through their salary.
Here is how the software fills the return. The user uploads Form 130 (called Form 16 until the Income-tax Rules 2026), the certificate from the employer that shows the salary paid and the tax already deducted. This deducted tax is called TDS, tax deducted at source. With the user's permission, the software also downloads the AIS, the Annual Information Statement. The AIS lists what the department already knows about the person, such as bank interest, dividends and sales of shares. The software matches the two, fills in the right ITR form and works out the tax under both the old and the new tax regimes. It shows which regime costs less. The user then e-verifies the return with an OTP sent to the mobile number linked to Aadhaar.
Take, for example, a software tester in Chandigarh. Her AIS shows ₹18,000 of interest from a fixed deposit that she had forgotten about. The software adds it to her return, so that she does not receive a notice later. It also finds that her employer deducted more tax than she owed. She receives a refund of ₹9,400 in her bank account. If she sold shares through a stock trading app, the software also imports the broker's statement of her capital gains.
Some companies sell a second product to employers, called flexible benefits. Parts of the salary, such as meal cards, fuel bills and phone bills, are paid in a form that is taxed less. Meal cards and phone bills paid in this way reduce tax under both the old and the new tax regimes. The software works with the employer's HRIS and payroll system, so that payroll deducts less tax every month. This sits next to the employer's benefits administration system.
In America, tens of millions of people file their own tax returns with software of this kind, and the same idea is spreading in India. Some companies that sell tax software also run a credit score monitoring app. Both apps help with a person's own money, which is described in personal finance.