Verify All Personal Information
This seems basic, but errors in personal details are a common slip-up. Double-check that your PAN, Aadhaar, date of birth, mobile number, and email address are correct on the ITR form. Any mismatch between your details on the tax portal and your bank
records can cause problems, especially with refunds. Ensure your name on your PAN card matches the name in your bank account for successful validation.
Choose the Correct ITR Form
Selecting the right form is a foundational step. Using the wrong one can lead to your return being marked as 'defective' by the Income Tax Department, requiring you to file a corrected version. The choice of form depends entirely on your sources of income. For instance, a salaried individual with an income below ₹50 lakh and no capital gains typically uses ITR-1. However, if you have income from capital gains, foreign assets, or more than one house property, you'll need to use a different form like ITR-2 or ITR-3.
Reconcile Income with AIS and Form 26AS
This is perhaps the most critical check. The tax department has a comprehensive view of your financial transactions through the Annual Information Statement (AIS) and Form 26AS. Before filing, you must compare the income details in your ITR draft with what's reported in these statements. The AIS includes details like salary, interest, dividends, and securities transactions. Form 26AS is crucial for verifying the Tax Deducted at Source (TDS) by your employer, bank, or other entities. Any mismatch can trigger an automated notice.
Report All Sources of Income
Many taxpayers assume that if income doesn't appear in their Form 16 or AIS, it doesn't need to be reported. This is a costly mistake. You must declare all income, including interest from savings accounts and fixed deposits, rental income, dividends, and capital gains from investments, even if no tax was deducted. Forgetting to report these can lead to notices for underreporting income, which can attract a penalty of 50% of the tax payable on that income.
Claim All Eligible Deductions Correctly
While maximizing tax savings is important, ensure you are eligible for every deduction you claim. Double-check your investments and expenses under sections like 80C (for PPF, life insurance), 80D (health insurance premiums), and others. Claiming a deduction for which you don't meet the conditions or don't have proof can lead to scrutiny and tax demands later. Make sure your claims are accurate and you have the necessary documents to back them up.
Pre-Validate Your Bank Account
If you are expecting a refund, this step is non-negotiable. The Income Tax Department will only issue refunds to bank accounts that are pre-validated on the e-filing portal. To pre-validate, you need to log into the portal, add your bank account details (account number, IFSC), and submit it for validation. The process is automatic and ensures your PAN is linked to the account. Also, ensure you nominate one of your validated accounts for the refund.
Don't Forget to E-Verify Your Return
Clicking 'submit' on your ITR form is not the final step. Your filing process is only complete once you e-verify the return. An unverified return is considered invalid, as if it was never filed at all. You have 30 days from the date of filing to complete the verification. This can be easily done using an Aadhaar OTP, your pre-validated bank account, or net banking.
