1. Choosing the Wrong ITR Form
This is one of the most frequent and fundamental errors. The Income Tax Department has different forms for different categories of taxpayers and income sources. 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 income from capital gains or foreign assets, you'll likely need to file ITR-2. Filing the wrong form will result in your return being marked as 'defective', requiring you to refile and causing significant delays.
2. Not Reporting All Income Sources
Many salaried taxpayers make the mistake of only declaring the income shown in their Form 16. You are required to report all income, no matter how small. This includes interest earned from savings accounts and fixed deposits, rental income, dividend income, capital gains from stocks or mutual funds, and any freelance or part-time work. The tax department has access to this information through your Annual Information Statement (AIS), and any mismatch will be flagged, potentially leading to a notice for under-reporting income.
3. Ignoring Form 26AS, AIS, and TIS
Before filing, it is essential to reconcile the information in your documents with Form 26AS (your tax credit statement), the Annual Information Statement (AIS), and the Taxpayer Information Summary (TIS). These documents, available on the e-filing portal, provide a consolidated view of all your financial transactions and taxes paid during the year as recorded by the department. Any discrepancy between the TDS claimed in your ITR and the amount reflected in Form 26AS can lead to a reduced refund or an unexpected tax demand.
4. Providing Incorrect Personal Details
Small typos can cause big problems. Ensure your name, PAN, date of birth, email address, and mobile number are entered correctly and match the details on your PAN card. Most importantly, double-check your bank account number and IFSC code. If you are due a refund, providing incorrect bank details is a primary reason for it being delayed or failing. The account must also be pre-validated on the income tax portal to receive refunds.
5. Making Errors in Deduction Claims
While it's important to claim all eligible deductions to lower your tax liability, it's equally important to claim them correctly. Common mistakes include claiming deductions without having the required investment proofs or exceeding the specified limits under sections like 80C and 80D. For House Rent Allowance (HRA), ensure you have rent receipts and have provided the landlord's PAN if the annual rent exceeds ₹1 lakh. Claiming incorrect deductions is a major reason for returns coming under scrutiny.
6. Forgetting to Verify Your Return
Hitting the 'submit' button is not the final step. Your ITR filing is incomplete until you verify it. An unverified return is treated as if it was never filed at all. You have 30 days from the date of filing to complete the verification process. The quickest way is through an Aadhaar-based OTP, but you can also use net banking or a bank account EVC. Missing this crucial step will invalidate your return and can lead to penalties for not filing.
