Written bySagar Malik
Whether favorable or not, you should never ignore a notice from the Income Tax department.
Here are six common reasons the I-T department might send you a notice, and what you can do about them.
In case you fail to file your ITR by the stipulated due date, the Income Tax department might send you a reminder notice in this regard.
Not filing your ITR on time could invite a late fee upto Rs. 10,000, interest @ 1% PM, and even prosecution, among other consequences.
Note: August 31, 2019 is the last date to file ITR for FY 2018-19.
You may end up receiving a notice from the I-T department, in case there's a mismatch or discrepancy in the return filed by you.
You may forget to declare some part of your income, or might claim a deduction under the wrong section, or choose the wrong form to file ITR.
In such situations, review the notice and your return, and make necessary corrections.
The Income Tax department might issue a notice in case you do not report certain high-value transactions.
These transactions include credit card payments of Rs. 2 lakh or more, cash deposits into bank worth Rs. 10 lakh or more, and investment in debentures/bonds worth Rs. 5 lakh or more.
Hence, always make sure that you furnish your PAN details while entering into such transactions.
There is often a mismatch in the amounts of Tax Deducted At Source (TDS) shown by you, and the actual TDS deducted during a particular financial year.
It could happen in case your employer forgot to file their TDS return, but the same is shown in your ITR.
So, make sure the TDS amount in Form 26AS matches with the amount in your ITR.
Many taxpayers tend to purchase assets in the names of their spouses, children, parents, and siblings, and other family members, in order to evade taxes.
But, any income ascertaining to these sources is bound to attract taxes that must be paid by you.
And if you fail to do so, the I-T department may issue you a notice over the matter.
The Income Tax department has started scrutinizing returns randomly, in order to ensure greater tax compliance among citizens. If you receive a notice, especially under Section 143(2), in this regard, do check its validity, and respond to it within the allotted time period.
Love Business news?
Subscribe to stay updated.