Are you always worried about filing your income tax return (ITR) the wrong way? Here are some of the most common mistakes that people make while filing ITR. By avoiding them, you will be able to file your taxes in a hassle-free manner:
- Filing the wrong ITR form
Using the wrong type of ITR is one of the most common mistakes. If you earn income from salary only, you should file your return in Form ITR 1 (Sahaj). Similarly, if you are running a departmental store in a proprietary business, you need to file your return in ITR 3 or ITR 4 (for FY 2016-17).
The form numbers of ITR have been changed by the Income Tax Department for FY2016-17 filing and are given on the department website incometaxindiaefiling.gov.in. You may read the instructions carefully before filing.
- Non-verification of Form 26AS
Always take care of quoting the correct PAN that you give to your employer or others who deduct tax at source. If the TAN of your employer (Form 16) or other tax deductor (Form 16A) and/or PAN details are incorrect, you will not be able to claim the TDS credit.
Therefore, never forget to verify Form 26AS for the amount which has already been deposited by persons deducting tax on your behalf.
- Filing inaccurate details
Details like name, address and Aadhaar number are essential while filing a return of income. One can easily make silly mistakes and write these incorrectly. A review and verification of the essential facts, including your name, address, amount of tax, bank account details and other essential details is necessary to avoid missing out on your tax credit or income tax refund. In case you have filed your return and have noticed a mistake in it, the department gives you a chance to make a correction by filing a revised return.
- Failure to claim deductions
Deductions are very important to reduce your tax liability. Government of India has given numerous deductions under Section 80 of the Income Tax Act, including deductions for contribution in PPF account, deductions for expenditure on disabled persons and contributions to a charitable trust. Always include the deductions that you are allowed in the ITR. If you do not claim them while filing your taxes, the department will not allow the same.
- Disclosing all the incomes
Disclosing incomes including exempt incomes that you earn from all the sources is essential - be it winning from a lottery or income from selling your land/house. Often people get confused and treat income from fixed and recurring deposits as exempt. Do not make that mistake as they are taxable. Similarly, interest on saving account up to Rs. 10,000, dividends from stocks etc. are exempt income but notifying the same to the department is necessary.
- Unable to verify ITR-V in time
While e-filing the return of income, you are asked to digitally sign the return. In case, you don’t have a digital signature, Government of India gives you the option to send duly signed ITR-V to the Centralized Processing Centre (CPC), Bangalore. The ITR-V has to be sent within 120 days of filing of return via. ordinary or speed post only. Alternatively, you can also e-verify your return online within the above time period. If you fail to do so, your return is treated as if you never filed it.
So, avoid the mistake of not verifying your ITR-V. Happy tax filing!