With the tax filing deadline of July 31 approaching, salaried taxpayers must be vigilant when filing their Income Tax Returns (ITR).
Although filing ITR is generally straightforward, even minor errors can trigger notices from the tax authorities and potentially result in fines.
Some common errors include incorrect personal details, using the wrong tax forms, and not cross-verifying with Form 26AS.
Many taxpayers also fail to report income from other sources or exempted income, provide incomplete bank details, or forget to e-verify their ITR.
Below are some of the common mistakes taxpayers should avoid at all costs:
Incorrect filing of tax forms
Use the correct ITR form to report all taxable and tax-exempt income sources. For instance, salaried individuals with a gross income below Rs 50 lakh and no capital gains should use ITR 1. Filing the wrong form can lead to errors and penalties, and the return may be deemed defective.
Not checking Form 26AS
It may be noted that Form 26AS provides a comprehensive view of your income, TDS, self-assessed tax paid, and advance tax paid. Cross-verify this information with your employer’s Form 16. Inaccuracies can result in less refund or more tax payable.
Failure to report income from other sources
Income from other sources, such as interest from savings accounts or dividends, must be reported under Section 56 of the Income Tax Act. Neglecting to report these earnings can lead to issues with the IT department.
Not mentioning exempted income
Even exempted income must be reported. For example, capital gains from the sale of a house that are reinvested to buy another house are exempt under Section 54 but should still be disclosed in the ITR.
Incomplete and inaccurate bank details
Accurate bank details, including name, IFSC code, and account number, are essential for processing refunds. Many refunds are delayed due to incorrect bank information. Pre-validate your bank account to ensure smooth processing.
Failure to e-verify ITR V
Verifying your ITR within 30 days of filing is mandatory. Without verification, the IT department will not process your return, and it will be considered invalid. Failure to respond to notices regarding verification can lead to penalties for non-filing.
By being mindful of these common errors, you can ensure a smoother and more efficient tax filing process. Prepare your documents early and double-check all information to avoid last-minute stress and potential issues with the Income Tax Department.
Source Agencies
