5 income tax returns filing mistakes you must avoid
Income tax returns (ITR) filing: The form you need depends on the amount of income, source of income, ownership of assets and so on. Filing tax return using a wrong ITR form can be treated as ‘defective'. Taxpayers will have to file a revised ITR using correct form.
Income tax returns (ITR) filing is a complex procedure. More often than not, we tend to make a few mistakes unknowingly. We have compiled 5 common mistakes that taxpayers often make. Avoid these mistakes, lest Income Tax Department slaps a notice on you.
1) Wrong income tax return form selection
Multiple income tax return (ITR) filing forms from ITR-1 to ITR-7 are available for filing of returns by different income tax assesses. The form you need depends on the amount of income, source of income, ownership of assets and so on. Filing tax return using a wrong ITR form can be treated as ‘defective'. Taxpayers will have to file a revised ITR using correct form.
2) Not reporting interest income
Many a times, taxpayers forget to mention the interest income that they are earning on fixed deposits or other such fixed investments. This information needs to be filled in ‘Income from other sources’ section.
3) Not filing Income tax return (ITR)
Those with income below the taxable level often do not file ITR. However, this is a big no. This is not exactly a mistake, but a pure negligence. Refrain from being lazy and simply file your income tax returns even if your income level is lower than the taxable amount.
4) Not reporting all bank accounts
It's common for people to hold multiple bank accounts. From the assessment year 2015-16, a taxpayer is required to report all the bank accounts held by him in previous year. However, your dormant accounts could be left out.
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5) Failing to report income from the last job
Often tax payers are in a situation when they have to report income earned from two employers. sO, If you have switched jobs in a financial year then income from your previous job must be reported while filing income tax return along with income from the current job. If income for a few months is not reported, your TDS certificates, Form 16 and Form 26AS may reflect some sort of discrepancy.