income tax return filing

The initial phase in filing of a tax return is to choose the right Form of return. It must to be noticed that the Forms of return might be changed in the middle the year. The taxpayer, hence, need to file in the new form. There are seven Forms of return advised by the tax authorities. Out of these, ITR 1 to 4  are applicable to individuals/HUFs, while ITR 5 is for Partnership Firms and LLP, ITR 6 is for Companies other than those claiming exemptions (See Rule 12) and ITR 7 is for  [For persons including companies required to furnish return under section 139(4A) or section 139(4B) or section 139(4C) or section 139(4D (Please see rule 12 of the Income-tax Rules). Subsequently, correct form should be filled in.

1. Common Mistakes While Filing The Return Form:

1. Interest from bank deposits or NSC certificates should be disclosed

2. Deduction for investment made under 80C, 80CCC & 80 CCD is restricted to Rs 1.50 lakh

3. Income of spouse or minor child may have to be clubbed with the income of taxpayer

4. Be cautious while calculating surcharge and education cess

5. Safely file all relevant documents for future needs

6. Double check all key information like PAN No., bank account details, communication address etc

In case of a refund, the bank account number needs to be filled in accurately. In case the refund is opted to be received via ECS direct into the bank account, adequate care should be taken to correctly fill in the MICR code. Any mistake may lead to problems in credit of tax refund and consequent inconvenience.

2. Precautions While Filing The Return

1. File the return in time

2. Online filing of returns

Similarly, if a paper return is filed, the acknowledgement slip should be preserved carefully.

3. Key rules to be followed to ensure trouble free processing

  • Once E-filing is done (without digital signature), ITR V needs to be sent in time to CPC. In case ITR V acknowledgement is not received within reasonable time, the assessee may call up the CPC call centre to verify status Nearly 10% of assessees have failed to send the ITR V to CPC after E filing.

  • Assessee needs to fill his email address, mobile number correctly to ensure appropriate communication from the Income Tax Department. The use of the Tax practioner/CA’s email address may not be appropriate.

  • The assessee should make sure the correct (latest) address, bank account number, MICR number is filled.

  • The assessee should verify tax credits available in Form 26AS/NSDL websites. Mismatches are the single largest cause of incorrect tax computation. Non credits may be taken up with the TDS deductor and/or the banker as soon as they are noticed.

4. Impact of Errors made while filing returns

  • Returns can be classified as defective u/s 139 (9) and in some scenarios the return can be declared in valid / Non Est. ITD is not introducing this concept to cover certain types of errors in order to prevent future grievances.

  • Computation Errors – In electronic filing, it has been noticed that most of the errors are due to data errors as filed by the assessee This includes non filling of key schedules, wrong details etc resulting in rectification requests etc which delay closure of processing.

  • Inability to pay refunds to the assessee.

5. Precaution in filling Personal Information Schedule

  • Name: Has to match the PAN database

  • Date of Birth: Mistakes here will result in computation of higher taxes in case of senior citizens

  • Address: House/Flat no, City, PIN Code, are mandatory fields. Non filling will result in refund delays

  • Email Address: Needs to be filled correctly, is the basis of all communication from CPC. Mistake will result in non receipt of all intimations from CPC. Use of Auditor/Tax practitioner’s ID may be avoided.

  • Mobile No: Full Mobile No without use of +91 needs to be entered. This is essential for all SMS based communication.

  • Sex: Should match the PAN database. If PAN database is wrong, it results in mistakes in computation.

  • Status : Should be correctly filled

  • Residential Status – the status of NOR and NRI should be mentioned only where applicable as they are not eligible for certain benefits available to resident assessee.

Thus, a little extra precaution on the part of taxpayers can help them avoid committing mistakes while filing of the tax return and keep them away from tax-man.

Contact or call +91-9820907711 for all Income Tax matters.

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