For all taxpayers, filing income tax returns (ITR) is mandatory. Maintaining compliance and accuracy is essential to avoiding fines and legal problems.
In this digital era, everything can be done electronically with a single click, and many taxpayers now prefer to file their Income Tax Returns (ITR) online. However, submitting ITR should be undertaken with extreme caution, since even minor errors can result in fines and legal proceedings. Individual taxpayers have until July 31, 2024, to file their tax returns.
1. Missing the Deadline
ITR filing deadline is one of the most frequent errors. Individuals often have a deadline of July 31st. Rushing at the last minute may result in revealing inaccurate information, which might harm the results of submitting taxes. There are fines of ₹1,000 to ₹10,000 for late submission, depending on how long the delay persists. Moreover, late filers may lose several deductions and be subject to a more thorough investigation by the Income Tax Department. So, be sure to file your ITR on time.
2. Entering Wrong Personal Information
Taxpayers should be careful while quoting their Name, PAN, Aadhaar, Address details and Bank details. Errors in personal information lead you to big trouble. These mistakes can result in rejected returns or delays in refund processing. Make sure all personal information is input accurately to prevent delays or more confusion. It's also crucial to give accurate information if you want the Income Tax Department to process your refund quickly.
3. Choosing the Incorrect ITR Form
When choosing an ITR form, taxpayers need to exercise greater caution. The different types of taxpayers and their income sources dictate which ITR form to utilize. Selecting the improper ITR form may result in the return being marked as defective or the ITR being declared null and invalid.
4. Non-disclosure of All Income Sources
Taxpayers have to disclose if there is any income from any source other than the primary source of income, including savings account interest, fixed deposit interest, rental income from house property, and any other source. It is a typical mistake not to declare all sources of income. However, failure to disclose these revenues may be investigated by the tax authorities and result in penalties. you preserve openness, make sure you fully declare all sources of revenue.
5. Ignoring Form 26AS
Form 26AS includes information about all taxes deducted and deposited against your PAN. Many taxpayers neglect this form, resulting in inconsistencies in tax liability calculation. Your refund may be reduced or your tax liability may increase if there are discrepancies between your Form 26AS and Form 16 or TDS certificates.
6. Mistakes in Deductions and Exemptions
Taxpayers commonly make mistakes while claiming deductions under several sections, including 80C, 80D, and 80G. Errors like this could result in reduced refunds or greater tax bills. Learn about the deductions provided by sections 80C, 80D, and other provisions. Make sure you have all of the necessary paperwork and legitimate claim deductions.
7. Neglecting Foreign Assets and Income
If you have foreign assets or income, such as foreign bank accounts or property, it is mandatory to report them in your ITR. The Ignorance to report such assets can result in significant penalties, legal action, and even incarceration in some situations. So, disclosing all foreign assets and income prevents future problems.
8. Failure to Verify the ITR
After filing, verifying the ITR is critical to finishing the procedure. Many taxpayers skip this step, making their returns worthless. Error in doing so may result in errors, which may incur further penalties. Verification can be completed online using Aadhaar OTP, net banking, or by mailing a signed physical copy to the CPC office.