News India Live, Digital Desk:Nowadays many people are getting notices from the Income Tax Department, and their number has increased considerably. These notices often occur due to mistakes or additional tax demand in income tax return (ITR), which makes people upset and confused. This is happening because the Income Tax Department is now paying more attention to following the rules and is catching up in the information of income. Let’s know what are the main reasons for this and what to do if you get notice.
The main reasons for the notice coming:
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Wrong ITR Form Filling: One of the most common causes of income tax notice is – to choose the wrong ITR form. According to the income of the people, there are different forms like ITR 1, ITR 2, ITR 3 and ITR 4. Many times people who first earn from the stock market (such as capital gains or F&O trading), accidentally fill ITR-1 or ITR-4, while they should have filled ITR-2 or ITR-3. With this mistake, their full income is not known and the department sends them notice of disturbances in the return.
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Do not match the information from Form 26AS: Form 26AS is a kind of tax statement, which contains your income and cut TDS on it. Many times people do not match their real earnings properly with the information given in Form 26AS while filing returns. Especially, the last quarter (January-March) of the financial year is several times updated in Form 26AS. If you have filled the return on the basis of only old 26AS, then your income may have been reduced, so that the tax department can send you notice of tax demand.
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Tax-free gift information: There is no income tax on gifts from certain relatives. But currently there is no clear way to tell such tax-free gifts separately in ITR form. Despite this, some people have received notices to pay tax on such gifts. This shows that there is some deficiency or confusion in the process of giving information.
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Recurred (Revised) Return No Processes: Many times, taxpayers take a mistake in their first filled returns and file a rectified return to fix it. However, they still get notice on the basis of old (wrong) returns. This often happens because their rectified returns have not yet been processed by the department, or the system needs some additional information from the taxpayer.
What to do on receiving income tax notice?
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Notice is real or fake, find out: First of all log on to the E-Filing portal of the Income Tax Department and go to the ‘Pending Actions’ section and check whether this notice is really sent by the department. Nowadays cases of fraud scams have increased by sending fake notice, especially on tax refund. Therefore it is very important to confirm.
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Understand what notice is about: Every notice comes under different sections of the Income Tax Act and everyone has a different meaning. If a notice is to make a mistake in the return, then someone for the demand for a mistake or tax in the account. It is important to understand why the notice has come, only then you will be able to answer correctly.
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Answer on time: There is a fixed time frame to respond to every notice, such as 15 days or 30 days. It is very important to answer within this deadline, otherwise you may face fine, interest or other legal proceedings. Timely response shows that you are following the rules.
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Improve mistakes (if necessary): If the notice describes any mistake or shortage of your return, improve it. For this, you may have to fill a revised return or give information sought. For example, if there is a disturbance in the return, then fix the mistake and file the return again within the stipulated time.
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If tax is made then repay: If you have sought additional tax due to low income or any other mistake in the notice, then calculate the right amount (with interest) and pay immediately. Note that there is no need to fill revised returns in such cases. You can answer the outstanding demand directly on the e-filing portal by going to ‘Pending Actions’ and can pay from there.
Why are the post income tax notices coming? Learn the reason and how to give the correct answer first appeared on News India Live | Breaking India News, The Indian Headline, India Express News, Fast India News.
