Digital Signature: All you need to know
Technological advancements have made the whole process of tax filing and submitting returns over the internet much simpler. In order to e-file income tax returns, taxpayers need to affix their digital signature onto their tax return document as a way to authenticate it. Under the IT Act 2000, a digital signature enjoys the same status as a regular signature. It attests and verifies that the taxpayer has authenticated the tax return documents in a safe environment, without fraud.
Digital signatures, which are issued by Certification Authorities, contain particulars like the taxpayer’s name, public key, name of issuing Certification Authority, expiration date of public key, the digital signature and its serial number. Tampering with digitally signed documents and claiming forgery over digital signatures are not possible, considering that a number of checks are in place to substantiate the same. Documents that are digitally signed are protected from further modifications and additions post signing.
Benefits of Digital Signature
Following are some of the benefits of using digital signature:
• A digital signature cannot be edited or tampered with.
• It is easier to track a digitally signed document.
• Brings down wastage of paper and is an environment-friendly option.
• Helps streamline the efficiency of the entire e-filing process.
• Reduces cost and adds to convenience.
Components of Digital Signature
For the purpose of knowing how a digital signature functions, one needs to first understand the elements involved in a digital signature:
• Name: The primary and utmost important thing that a digital signature holds is the name of the person who would be using it or authorizing a document by its use for a variety of purposes like filing documents with relevant authorities. A digital signature also reduces chances of a fraud getting commitment under his name by another person bearing the same name.
• Personal Information: Along with the full name, a digital signature also has vital and other relevant information like contact number i.e. mobile number, residential and office telephone numbers, email address, residential address, office address which may be used to locate and contact the person. This information is in an encrypted form and cannot be accessed by everybody, thus it also ensures privacy of the user.
• Public Key: Every digital signature has a special public key associated with it. This key is used for encrypting and securing a document at the time it is being authorised. It plays a very important role in the verification process. There is also an expiry date for each and every digital signature, which is determined by the public key associated with it. The public key shows the time frame during which a digital signature is valid. The key also helps to reset the digital signature, if the need arises.
• Serial Number: This is another key component that works as a unique identifier for a digital signature. This number is of prime importance to ensure the viability of a digital signature. The serial number is used by the certification authority who issues the digital certificate.
Where can you Use Digital Signatures
Digital signatures can be used in the following cases:
• For receiving and sending digitally signed emails.
• For conducting secure online transactions.
• For e-filing income tax returns.
• For signing documents such as MS Excel, MS Word and PDFs.
How to Register Digital Signature While E-Filing Income Tax Return
• Step 1: For filing tax returns using digital signature, the taxpayer needs to first register it on the Income Tax Department’s e-filing portal – www.incometaxindiaefiling.gov.in
• Step 2: On the e-filing website, the taxpayer needs to log in to his or her registered account using their user id and password.
• Step 3: After logging in, select the button that says “My Account” and click on “Update Digital Certificate” option.
• Step 4: A download of a file called “Store Certificate” should start automatically. A local copy of the digital signature will be saved on the computer system.
• Step 5: Go back to the web page and click on “Upload your USB Token” and you will be redirected to a page with a button that says “Select Your USB Token Certificate” and “Browse”. On clicking the “Browse” button, a selection window will open where you need to choose the file you just downloaded.
• Step 6: Select the file and click on “Okay”. Enter the PIN code, which is the Token Password, and then click on “Sign”.
Certifying Authorities for Digital Signature Certificates
The following are the licensed certifying authorities who have been authorized by government-appointed Controller of Certifying Authority:
• CDAC CA
• Capricorn CA
• e Mudhra CA
• NSDL e-Gov CA
• Indian Air Force
• Verasys CA
How to Get a Digital Signature
For the purpose of obtaining a digital signature online, the entity will have to submit certain documents to the certifying authority. These can include an application form that has been duly signed, a passport size photo and identification proof, among others. The applicant may be asked to provide his or her mobile number, email address and home or organization address. An essential point to be noted is that different countries will have different requirements from the applicants for the issuance of digital signature certificate.
Procedure for Uploading Income Tax Return Online Using Digital Signature
• Step 1: Fill out the ITR form, generate the file as an XML file and save it.
• Step 2: Visit the Income Tax India website. Log in to your registered account using your user ID and password.
• Step 3: After logging in, click on the tab that reads “Submit Return” and then select the Assessment Year.
• Step 4: Select the ITR Form Name from the drop-down menu.
• Step 5: The next field will ask “Do You Want To Digitally Sign The File?” Select the “Yes” button.
• Step 6: Select the kind of digital signature you want to use, it can be “Sign With .PFX file” or “Sign With USB Token”.
• Step 7: Upload the income tax returns with the help of digital signature certificate and authenticate it.