Filing your tax return at the last minute? Learn the obstacles you might face and the mistakes to avoid

To listen to the podcast, click above. To read the podcast conversation, scroll down.

The deadline for filing income tax returns for the 2023-24 tax year, July 31, is now less than a fortnight away.

At this crucial time, many CPAs and taxpayers have expressed concerns about difficulties in accessing the official e-filing portal, downloading the annual information return, or challenges in importing capital gains or losses from mutual fund brokers and intermediaries, etc.

Money control Preeti Kulkarni spoke to Mumbai-based Chartered Accountant Suresh Surana to understand the issues faced by taxpayers while filing their returns and the steps that the Income Tax department needs to take to resolve them. Surana also highlighted the measures that have already been taken to ease the process and the mistakes that taxpayers should avoid while completing the process.

Key takeaways from the discussion include:

• To begin with, the experience has become positive over the years, after the government launched a digitalisation drive, gradually making e-filing mandatory for most categories, except senior citizens.
• The time it takes to process tax returns has been reduced. Tax refunds are now typically processed within 15 days.
• That said, some challenges remain. The government now has a wealth of data on its transactions, as reflected in the Annual Information Return and Form 26AS.
• In the case of transactions such as the sale of co-owned properties, we have encountered cases where the AIS shows the total share instead of the actual share of the individual taxpayer. Even after submitting the response through the AIS feature, in some cases the problem is not corrected.
• We have also seen duplication of certain entries in AIS
• Sometimes the AIS shows information that does not correspond to the taxpayer
• Then, there are cases where the mutual fund amount shown on AIS is higher than the actual investment.
• The SIA provides options for reporting discrepancies. Ideally, along with the existing options, there should be another category for inserting comments, so that the specific issue requiring the attention of the income tax department can be mentioned.
• Then, there are glitches faced while using the e-filing portal: continuous buffering issue, which delays the online update process.
• Many taxpayers are turning to videos on social media to file their returns. Taking this approach can be risky.
• The information may be outdated or contain incorrect information about tax laws, deductions, or filing procedures. Non-professionals may not have up-to-date knowledge of recent changes in tax regulations.
• Apart from this, they should avoid common mistakes like choosing the wrong ITR form, not reconciling Form 16 with AIS and Form 26AS, not pre-validating bank accounts for tax refund, errors in providing personal information, etc.