Finance Minister Nirmala Sitharaman on Monday said that the Centre has issued one lakh notices to taxpayers These notices were specifically targeted at individuals whose income was found to be close to Rs 50 lakh. Check out 7 key reasons why you might receive an income tax notice from the tax authorities
To avoid discrepancies, it is vital to review your Form 26AS, AIS and Form 16 before filing your Income Tax Return (ITR). Even minor omissions or errors can trigger an income tax notice
The tax department conducts e-campaigns to notify taxpayers who have not yet filed their ITRs. If you have missed the deadline, you can still file an updated return within 24 months from the end of the relevant AY with an additional 25% or 50% tax, depending on the delay
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If high-value transactions, such as property purchases or significant credit card bills, do not align with your reported income , then it may lead to a tax notice
Sudden fluctuations in your income can prompt the income tax department to issue a notice asking for an explanation for these deviations. Additionally, the department may ask you to deposit the appropriate advance tax if required
Claiming deductions like HRA or Section 80C without proper reflection in your Form 16 issued by your employer may attract the attention of the tax department
A mismatch between the TDS credit claimed in your return and the amount reflected in your Form 26AS can result in a notice from the income tax department. To avoid such issues, always cross-check the TDS credit claim
Using the wrong ITR form could render your return defective and necessitate correction within the specified timeframe. For instance, salaried individuals should file ITR Form-1, while those with income from capital gains need to use ITR Form-2
If you receive an income tax notice, take the time to understand the reason behind it. Carefully review the notice and seek guidance if required from a tax consultant to ensure an appropriate response