Costly Mistakes While Filing ITR

Income Tax Return (ITR) is an obligatory activity for any taxpayer in India. In fact, the procedure has now grown web-based and simple to file, while still somehow many individuals seem to make common mistakes that lead them to notices or penalties or delayed refunds during the course of assessment. By knowing about these errors, you may save your time, money, and stress during this tax season.

1. Picking up the Show-Wrong ITR Form-

Many taxpayers unwittingly set out to select the wrong ITR form for filing. Each of them is for select sources of income, say salary, business, or capital gains. Not filing the appropriate form just makes your return defective.

Tip: Review the sources of income carefully for choosing the right ITR form.

2. Filing Late-

Early tax filings save late fees under Section 234F and interest on pending taxes. Besides, the tax deadline also holds bearing concerning the carry forward of certain losses. 

Tip: Fix the tax deadlines in advance and finish the filing before the ultimate day. 

3. Not Disclosing All Sources of Income-

A lot of people only disclose salary income and forget about interest from savings bank accounts, FDs, rental income, or freelance earnings. This omission could expose a taxpayer to intense scrutiny from the Income Tax Department.

Tip: Make sure to report all your income to avoid issues.

4. Wrong Bank Details-

Wrong bank account numbers and IFSC codes may cause a delay in refunds. Many taxpayers also forget to pre-validate their bank accounts, which is a prerequisite for processing refunds.

Tip: Must confirm your bank is active, with PAN linking in place, before final submission.

5. Ignoring Form 26AS and AIS-

Some taxpayers skip the income details laid down against them in Form 26AS and Annual Information Statement (AIS). Any discrepancy in the income declared by you and that appeared against your PAN in these two records may cause a notice to be served on you.

Tip: Always cross-check your income with Form 26AS and AIS before filing a return.

6. Filing No-Claim for Deductions Which Are Legally Entitled to them-

The taxpayers generally miss deductions available under various sections like 80C, 80D, or 80G. An oversight of such deductions increases their taxable income and thereby also cuts down on their savings. 

Tip: Keep record of eligible deductions and investments made during that financial year.

7. Not Verifying the ITR-

The filing is not complete unless the ITR is verified either electronically, i.e., through Aadhaar OTP, net banking, etc., or physically by sending the signed ITR-V form to CPC Bengaluru. ITR verification is left undone by many taxpayers, thus making the entire return invalid.

Tip: Complete e-verification immediately after filing to avoid rejection.

Final Thoughts-

Filing ITR correctly is extremely important to keep seated in compliance and not facing penalties.Such mistakes can be grossly expensive-mediocre tax planning, late filing, and a lack of awareness about the nuances of Form 26AS, bank details, and deductions-all of which can lead to a smooth tax filing experience. 

Professional advice or professionals providing assistance as one go along can provide that little extra edge to the ITR filing experience.