Selecting the Wrong ITR Form
One of the most frequent errors taxpayers make is picking the incorrect ITR form. The form you need depends on your sources of income. For instance, ITR-1 (Sahaj) is for resident individuals with a total income up to ₹50 lakh from salary, one or two house
properties, and other sources like interest. However, if you have any income from capital gains (like selling stocks or mutual funds) or foreign assets, you must use a different form, such as ITR-2. Filing the wrong form can lead to your return being classified as 'defective' by the Income Tax Department, requiring you to file a corrected return. Before you begin, double-check which form applies to your specific income profile to ensure a smooth process.
Forgetting to Report All Income
It’s crucial to declare income from every single source, not just your primary salary. Many people forget to include earnings from savings accounts, fixed deposits, dividends, or rental income. Even income that might be exempt from tax, like interest from a PPF account or agricultural income over ₹5,000, must be reported. The Income Tax Department has access to your financial data through the Annual Information Statement (AIS) and Form 26AS. Any mismatch between the income you declare and the data available with the department can trigger a notice and potential penalties for under-reporting income.
Mismatching Data with Form 26AS and AIS
Before filing, you must reconcile the information in your ITR draft with your Form 26AS (your tax passbook) and your AIS. These documents show all the tax that has been deducted at source (TDS) on your behalf by your employer, bank, or other entities. A common mistake is a mismatch between the TDS you claim and the amount reflected in these forms. This often happens if an employer has made an error or if you forget to account for TDS deducted on FD interest. Discrepancies can lead to your refund being delayed or a demand notice from the tax department. Always download the latest versions of these forms from the e-filing portal and ensure your numbers align perfectly.
Providing Incorrect Bank Details
A simple typo in your bank account number or IFSC code can indefinitely delay your tax refund. It's essential to provide the details of an active bank account that is linked to your PAN. The department also requires you to pre-validate the bank account you wish to receive your refund in. This is a straightforward process on the e-filing portal that confirms the account belongs to you. Take a moment to verify every digit and ensure the account is pre-validated to avoid any refund-related hassles.
Failing to Verify Your Return
This is the final, and most critical, step. Simply filing your ITR is not enough; you must also verify it. An unverified return is considered invalid, as if it was never filed at all. The deadline for verification is 30 days from the date of filing. If you miss this window, your filing will be void, and you could be liable for a late filing penalty. The easiest way to verify is electronically via Aadhaar OTP, net banking, or through your bank or demat account. Do not forget this crucial last step.
What if You Still Make a Mistake?
If you realise you've made an error after filing and verifying your return, don't panic. The Income Tax Act allows you to file a 'Revised Return' under Section 139(5). You can correct any mistake, such as unreported income or a missed deduction, by filing a revised return. This can be done any time before December 31 of the assessment year. There is no penalty for filing a revised return, and it effectively replaces your original filing. It’s always better to correct a mistake yourself than to wait for the tax department to find it.
