Taxpayers often view filing tax returns as a tedious experience. However, if you start the process a little earlier and have all the necessary documents with you, this task can be easy for you. You should keep in mind some errors that taxpayers usually make when filing their returns and for which they receive a notice from the Income Tax Department.
Taxpayers generally find filing tax returns to be a tedious experience. However, if you start this process a little early and have all the necessary documents, this task can be easy for you. You must keep in mind some mistakes that taxpayers usually make when filing their returns and that is why they receive a notice from the Income Tax Department.
Here we tell you about 10 such mistakes, which you should avoid while filing your returns for 2023-24.
Not verifying the details of Form 16 and Form 26AS
Before you start filing your return, don’t forget to download Form 26AS and Annual Information Return (AIS). Both forms are available on the Income Tax electronic filing portal. Existing financial records in 26AS such as TDS etc. must match with the details in Form 16. Any difference between the two can create problems for you and you may receive a notice from the Income Tax Department.
Choosing the wrong ITR form
If you chose the wrong form when filing your return, you may receive a tax notice. For example, if you have earned capital gains from the sale of shares or units of mutual funds and you are using Form ITR-1 instead of ITR-2, you may receive a notice from the tax department of non-disclosure. If you choose the wrong form, your return will be declared “defective.”
Do not disclose foreign assets
Many Indian employees, especially those in the IT sector, are also posted abroad. In such a situation, they open bank accounts in those countries. However, many of these people forget to mention these accounts when they come to India and file their returns. It is very important to note that even if your account balance is zero, it is necessary to mention said account.
Failure to disclose capital gains income
AIS and Form 26AS contain complete details of taxpayer transactions, so no information about any income can be hidden. If you do not provide information about profits made from the sale of shares or mutual fund units in the return, you may receive a notice.
Claim incorrect exemptions
You may also receive a notice if you donate to political parties or fraudulently obtain exemption under Section 80C of Income Tax. Moneycontrol has already reported that the Income Tax Department is using technology to detect suspicious cases of tax exemptions.
Failure to keep exemption-related documents secure
If you have chosen to file returns under the previous regime, you must keep all documents that serve as tax exemption. By doing this, you will be safe in case of any kind of investigation and you will not have to face any problem.
Do not provide information about the income of the previous employer.
If you have worked for two companies in one financial year, the rules say you must take professional help when filing. These people have two Form 16s. One Form 16 is provided by the current employer, while the other form is provided by the previous employer. Do not forget to mention the income received from both companies in the declaration. AIS contains complete details about your income, so the details of both Model 16s will be visible in it.
Provide incorrect bank account details
You will get a refund only on the bank account number provided by you. If your bank account number is not correct, your refund may be delayed. It is very important to be careful while providing account number, IFSC, bank name and other details in ITR.
Submit declaration at the last minute
Postponing the work of filing the return and taking it to the last minute can be detrimental. You may forget to mention a lot of important information quickly. When the last date to file the return arrives, the traffic on the Income Tax Department website increases a lot and due to this, technical problems also start to increase at the last moment. Therefore, by filing the return a little early you can save yourself from many types of hassles.
Electronic verification process not completed
The ITR filing process is not completed by simply filing the return. After this, the return needs to be verified, after which the Income Tax Department will process it. You can verify your return using Aadhaar number through the Income Tax Department e-filing portal with the help of bank account, demat account, etc. You can download the ITR-V form from the e-filing website and submit it to the Central. Income Tax Department processing center located in Bengaluru. Its verification is carried out 30 days after submitting the return, the verification date will be considered the date of submission of the return.
