Common mistakes to avoid when filing your tax return online

Tax Return Filing (RTI) is now available on the e-filing portal and the Income Tax Department has asked taxpayers to become an early filer. “Check your Form 26AS, AIS and other relevant documents before submitting. Be an early filer,” the IT department tweeted on June 22.

For individual taxpayers, to whom the tax audit is not applicable, the deadline for filing the ITR for the 2021-22 financial year is July 31, while for taxpayers to whom the tax audit is applicable, the deadline for ITR filing is October 31. Companies that need the TP report can file the ITR by November 30.

During the ITR filing period, taxpayers are required to obtain and verify several documents. However, many taxpayers miss small details that lead to errors when filing ITRs online.

Here are some common mistakes you should avoid when filing your tax return online.

1. Not cross-checking the Form 26AS statement

You must double-check Form 26AS before filing ITR. The form contains information about your income, tax withheld at source (TDS), withholding tax paid, self-assessment tax paid and more. All salaried persons must cross-check their information with the employer’s Forms 16 and 26AS.

2. Provide incorrect personal information

Always ensure that you provide correct personal information. Taxpayers often make mistakes by providing information such as PAN details, email id, date of birth or incorrect bank account number or IFSC code. These seemingly innocuous reporting errors can lead to delays in refunds, rejection of your return by tax authorities, or lead to penalties, criminal interest and even a tax audit.

3. Do not send ITR-V to CPC

If you are filing returns without digital signature and Aadhaar based verification, a signed copy of the ITR-V should be sent to the Bangalore branch of the Centralized Processing Center (CPC) of the Income Tax Department within 120 days from electronic filing. Failure to do so will invalidate the ITR deposit.

4. Forgetting to mention exempt income

Many taxpayers assume that since exempt income is not taxable, it does not have to be reported in the ITR. However, this is not true as all taxpayers are required to file an ITR if gross income exceeds Rs 2.5 lakh irrespective of exemptions.

5. Forgetting to mention income from all sources

Be sure to disclose all your sources of income, even if you are an employee. You may have additional income such as real estate rents, interest on term deposits, stock dividends, capital gains, etc. Mentioning all your sources of income is mandatory even if this income is tax exempt.

6. Do not pay withholding tax

A salaried person does not need to pay withholding tax as employers deduct the applicable tax from the salary in the form of the monthly TDS. However, if you are self-employed or have other sources of income, apart from salary, you must pay a tax advance. If the advance tax is not paid on time, interest is charged on the contribution.

7. Not Checking ITR

Your tax return process is incomplete until you verify your RTI return. A period of 120 days is available to verify your ITR after submitting your completed ITR form.

You can currently check your ITR by:

  • Sending a signed physical copy to CPC, Bangalore.
  • Using e-verification via Aadhaar OTP.
  • Using online verification through a bank’s Internet banking service.
  • Do not declare the income of minor children.
  • Any income earned by minor children must be combined with the parents’ income when calculating taxable income. Also, if the minor child derives income from work using special knowledge or talents, then the minor child must file an ITR separately.

    (Edited by : Sudarsanan Mani)

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