6 Common mistakes one should avoid while filing ITR
CA Ankit Rungta
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Now that the year has ended, we will all consolidate our activities to file our Income Tax Return for FY 2018-19. The due date for the same is 31st July' 2019. Hence, it becomes very important to keep these things in mind, while preparing & filing an Income Tax Return for AY 2019-20 (FY 2018-19).
1. Not declaring all income sources- While filing income tax return, make sure to report all your income sources. This is the most common mistake committed by the taxpayers. The income from other sources includes interest earned on the bank savings account, fixed deposits (FDs), insurance and other schemes like public provident fund (PPF). On fixed deposits, 10 per cent tax deductible at source (TDS) applies.
However, income from all the sources must be reported including the tax-free ones as well. Income-Tax Department (I-T department) can send a show cause notice in case taxpayers fail to do do. In fact, all those employees who have recently changed their job are required to disclose income earned from the previous and current employer both.
2. Wrong personal details in the ITR form- Mentioning wrong personal details in income tax return filing should be avoided. Taxpayers often commit errors in the details like name, address, PAN, email ID, etc. This leads to the rejection of ITR form by the department. The name in the ITR form should be same as that on the PAN card. Moreover, address and email id should be mentioned correctly or else the taxpayer might end up missing important notifications.
3. Filling wrong ITR form- I-T department provides eight forms to file. Each form is for a different type of taxpayer. These forms are ITR-1, ITR-2, ITR-3, ITR-4, ITR-5, ITR-6, ITR-7 and ITR-V. For instance, ITR-1 or SAHAJ is filled by the resident individuals whose total income for the particular assessment year includes salary or pension, one house property or the income from the other sources.
4. Giving wrong bank details- One should provide correct bank details along with the Indian financial system code (IFSC) details. Incorrect bank account details might lead to problem in case of refunds and hamper the process.
5. Declaration of properties- If you own more than one house property then you have to pay tax on it. Either it is occupied by tenant or by the relatives, you are liable to pay tax on it.
6. Selection of wrong year to file ITR- Many taxpayers often get confused on the year of filing income tax returns. Always remember that the financial year of your income is the previous year. And the year in which your income is assessed and return has to be filed is called an assessment year.
It's generally a good practice to have an expert take care of such things for you in this ever changing compliance requirements. Be it your uncle in family, who takes care of these things or a friend who helps you with investments and savings. An expert can make a huge difference, especially in the world where every digital activity carries a footprint, including the Income Tax Department.