Income Tax Return (ITR) filing: These mistakes often made by taxpayers
December, 02nd 2021
Have you filed your Income Tax Returns (ITR)? If not, then do it at the earliest as the deadline is approaching. Most taxpayers would have already got all the documents needed for filing their ITR. Under Section 87A, anybody with an annual income of up to ₹5 lakh a year is eligible for a rebate that reduces the tax to zero.
There are some major mistakes that you should avoid for a hassle-free ITR filing experience.
The most common mistake that a taxpayer makes is not reporting their interest income. “When filing income tax returns, taxpayers must report the interest income generated from savings accounts and fixed deposits. Once taxpayers report the interest income, they become eligible to claim deductions. They can claim deductions on interest income generated on savings accounts up to ₹10,000 under section 80TTA. A deduction of up to ₹50,000 can be claimed under section 80TTB for interest, in the case of a senior citizen,"said Abhishek Soni, CEO & Co-founder, Tax2win.in
Inaccurate bank details
In addition to this, other commonly observed mistakes include not reconciling the Form 26AS statement, providing inaccurate bank details, and giving wrong disclosures. “ Submitting a tax return is a complex procedure, individuals must exercise extreme caution to avoid making mistakes," added Abhishek Soni.
Selecting the Incorrect Form
It is of utmost importance to select the appropriate ITR form for filing returns. Failure to do so can result in your return not getting processed by the income tax department. “The selection of the ITR form is based on the nature of income or the category to which the taxpayer belongs. In case a taxpayer has filed an incorrect return form, he is most likely to receive a defect notice from the department which must be rectified within the specified time limit. Example: If you are a salaried individual with income below ₹50 lakh and with no capital gains income, the appropriate form for you is ITR-1, while it is ITR-3 if you are an individual having income from business or profession," said Archit Gupta, Founder and CEO - Clear
Quoting the Wrong Assessment Year
While filing the returns, one must make ensure to provide the correct AY for FY 2018-19 the correct corresponding AY is 2019-20. Mentioning the wrong AY increases the chances of double taxation and attracts unnecessary penalties, he added.
ITR filing deadline
In view of the technical glitches that taxpayers and professionals have been reporting since the launch of the new e-filing portal, the income-tax department had extended ITR filing to 31 December 2021.
“The due date of furnishing of Return of Income for the Assessment Year 2021-22, which was 31st July 2021 under sub-section (1) of section 139 of the Act, as extended to 30th September 2021 vide Circular No.9/2021 dated 20.05.2021, is hereby further extended to 31st December 2021," Finance Ministry had said in a statement.