Incorrect filing of Income Tax Returns (ITR) can involve a lot of trouble later. Therefore, it is better to be aware of the common errors people commit.
1. Choosing the wrong ITR form
Different classes of taxpayers have to file their returns in different forms. So they have to choose their appropriate form. Filing tax in the incorrect form can result in rejection of ITR.
2. Incorrect personal information
Often one can make a mistake while typing basic information about oneself such as Aadhaar, PAN and address details. The e-mail id and contact phone numbers are also crucial and should not be filled in casually. One must double check to ensure they are correct.
3. Not informing all income sources
Every taxpayer should report all their income sources. They should include all income even if any income is exempt from taxes. Often intentionally or unintentionally taxpayers fail to submit their full information. While filing ITR they should include all information such as rental income, interest earned, any small business that they might do other than regular income, freelance work etc.
4. Not submitting requisite forms
One has to file some forms to claim certain exemptions. Exemptions under sections 80C, 80D, and 80G can require forms to support exemptions claimed.
5. No evidence for deductions claimed
For all expenses or investments claimed as deductions such as children’s tuition fees, LIC, PPF, medical insurance policy etc taxpayers must maintain records, evidence, and proofs.
6. Not reconciling Form 26AS
Form 26AS is a consolidated tax statement that provides details of tax deducted at source (TDS) and tax collected at source (TCS) to the Income Tax Department in a taxpayer’s name. If one fails to reconcile information in Form 26AS with personal records it can lead to the taxpayer getting a notice.
7. Not reporting income from last job
If the taxpayer has switched jobs in the last FY, all income from all jobs has to be reported. Not reporting anyone can lead to differences between TDS certificate and Form 26AS.
8. Concealing foreign assets/income
Not reporting any bank account or income or property held abroad can have serious consequences, legal action and fat penalty.
9. Neglecting verification before submission
Submission of the ITR ends only with the verification of the return within 30 days of filing. One can get a notice from the department.
10. Crossing the last date
Missing the deadline for filing ITR entails a penalty. One should never wait for the due date and file taxes well ahead of it. This year the last date of submission is July 31, 2024.
We are in the final stages of the ITR filing season. One must be aware of the common mistakes before beginning the income tax filing process. Personal Finance Business News – Personal Finance News, Share Market News, BSE/NSE News, Stock Exchange News Today
