New Delhi: The due date for filing of income tax return (ITR) for the financial year 2017-18 (assessment year 2018-19) is 31 August 2018. In a rush to meet the deadline, many taxpayers might end up making mistakes which might fetch them a notice from income tax authorities. “Though mistakes committed in ITR filing can be rectified by filing revised return, it would require extra time and efforts," said Vishal Raheja, assistant manager at Taxmann, an online publisher on taxation and corporate laws.
Income tax return for the assessment year 2018-19 can be revised by 31 March 2019.
The income tax department has notified seven ITR forms for filing of return for FY 2017-18. ITR filing process starts from choosing the correct form, which depends on the nature of income and the status of the taxpayers. Some of the common mistakes that you should avoid committing during ITR filing:
(1) “Don’t presume that if tax has already been paid, you don’t need to file the return," says Vishal Raheja of Taxmann. If you are resident in India, irrespective of tax liability, you have to file ITR if taxable income exceeds basic exemption limit, which is ₹ 3 lakh for senior citizens (age above 60 years), ₹ 5 lakh for super-senior citizens (above 80 years) and ₹ 2.5 lakh for all other individual taxpayers.
(2) If you choose the wrong ITR form, you may not report the complete information and the income tax department can issue a notice for under-reporting income.
3) However small the income may be, you should report it in our ITR, say tax experts. “Income tax department gets regular information from banks and financial institutions about your transactions which are reconciled with your ITR. If some tax has been deducted from your income but you don’t report the corresponding income in ITR, you might get a notice," says Raheja.
(4) If you have changed jobs during the year, you have to report income earned from all the employers in your tax return. Further, “if any income of your minor child or spouse is required to be clubbed with your income then you have to report it," he adds.
(5) Tax experts warn against claiming deductions in ITR for which you are not eligible for. “Some taxpayers claim fake deductions or inflate existing deductions to reduce their income tax liability or to claim refunds," says Raheja.
(6) A taxpayer should also ensure that ITR data is in sync with that of Form 26AS. In case of any discrepancy, the income tax department could issue notice, seeking explanation for discrepancies in the figures of income or TDS appearing in Form 26AS and income tax return. Form 26AS is basically a consolidated tax credit statement that has all details of various taxes deducted on your income at source. Form 26AS can be accessed from the tax department’s website.
(7) If you are filing ITR belatedly, then make sure that pay late filing fees before filing of ITR, say tax experts. “A late filing fees of ₹ 5,000 shall be charged if the return is filed between 01.08.2018 and 31.12.2018. The fees shall be ₹ 10,000 if return is filed between 01.01.2019 and 31.03.2019. The late filing shall be ₹ 1,000 for small taxpayers whose taxable income is up to ₹ 5 lakh," says Raheja.
(8) If you fail to either e-verify your ITR or post it to Centralized Processing Centre (CPC) of the income tax department in Bengaluru, return will be treated as an invalid return. While filing ITR you are asked to digitally sign or e-verify it. In case, you do not e-verify your return, you can sign the acknowledgement copy of ITR and post it to CPC, Bangaluru. The acknowledgement has to be sent within 120 days of filing of the return.