ITR Filing Mistakes: Usually, the Income Tax Department issues notices in serious cases like error in filing income tax, mismatch of amount or tax evasion. Apart from this, if the department needs information related to your income or source of income, then notice is also issued in such a case.
ITR Filing Mistakes: These days it is the time to file income tax and all taxpayers have a chance to file it before 31st July. It is worth noting that those who file income tax return late will have to pay a penalty of Rs 5000. This time also there are lakhs of taxpayers who are going to file ITR for the first time. In such a situation, many people file ITR without correct information, after which they have to face income tax notice.
When the notice comes from the Income Tax Department, then they get worried. Under the guidelines of the department, investigation of the cases of such taxpayers who have not responded to the notice of the Income Tax Department has been made mandatory. In such a situation, it becomes important for every taxpayer to know which mistakes can lead to an income tax notice and what should be done to avoid it?
When do you face an income tax notice?
Under Section 142(1) of the Income Tax Act, this notice is issued when the taxpayer has not filed the tax return. The department also issues notices to obtain information related to any bank interest, long term capital gain/loss on sale of a property. The Central Board of Direct Taxes (CBDT) has also prepared guidelines regarding this.
Why is an income tax notice issued?
Usually, the Income Tax Department issues notices in serious cases like error in filing income tax, mismatch of amount or tax evasion. Apart from this, if the department needs more information related to your income or source of income or investment, then a notice is also issued in such a case. Section 142(1) of the Income Tax Act gives the Income Tax officers the right to issue a notice and seek information in case of filing of return. In cases where the return has not been filed, they are asked to submit the required information in the prescribed manner. Apart from this, IT notice can also be received for inquiry.
What is revealed by IT Notice?
By sending notice, the department tries to know from the taxpayers the reason for the mistake they have made in filing ITR. If the income and the filed figures are not matching, then there is a reason for it. The department ensures that no kind of mistake is encouraged and it can be corrected by investigating it at the right time. When the taxpayer responds to the notice, many information comes to light. This helps the department in investigating.
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