To ensure a smooth and stress-free ITR filing in Lucknow and beyond, it's essential to be aware of the pitfalls. Here are some common mistakes taxpayers make and how to avoid them:
Common ITR Filing Mistakes to Avoid:
1. Choosing the Wrong ITR Form:
One of the most frequent errors is selecting an incorrect ITR form. The Income Tax Department has different forms (ITR-1, ITR-2, ITR-3, ITR-4, etc.) based on your income sources, total income, and other criteria. For example, if you have capital gains or multiple house properties, ITR-1 (Sahaj) would be the wrong choice. Using the wrong form can render your return defective or invalid, leading to complications.
How to avoid: Carefully assess all your income sources (salary, business, capital gains, rental income, interest, etc.) and refer to the Income Tax Department's guidelines or consult a Tax Consultant Lucknow to choose the correct form.
2. Not Reconciling AIS, TIS, and Form 26AS:
The Annual Information Statement (AIS), Taxpayer Information Summary (TIS), and Form 26AS are crucial documents that provide a comprehensive overview of your financial transactions and taxes deducted/collected. Many taxpayers fail to cross-verify these with their own records (Form 16, bank statements, investment proofs). Discrepancies can lead to under-reporting of income or miscalculations, triggering tax notices.
How to avoid: Always download and meticulously compare the information in your AIS, TIS, and Form 26AS with your own financial documents. If there are any mismatches, get them rectified with the deductor (employer, bank, etc.) before filing your return.
3. Incomplete Disclosure of Income:
Every source of income, whether taxable or exempt, must be declared in your ITR. This includes interest from savings accounts, fixed deposits, dividends, rental income, capital gains from shares or mutual funds, and even income from freelance work or foreign sources. Even exempt income (like agricultural income or PPF interest) needs to be declared in the appropriate schedule (Schedule EI) to maintain transparency. Omitting any income can lead to penalties (50% to 200% of the unpaid tax) and scrutiny.
How to avoid: Maintain thorough records of all your financial transactions throughout the year. Don't assume an income is exempt or too small to declare. When in doubt, err on the side of caution and consult a professional.
4. Ignoring Changes in Tax Laws and Rules:
Tax laws are dynamic and subject to annual changes, particularly during the Budget announcements. For FY 2024-25, the new tax regime is now the default, and taxpayers wishing to opt for the old tax regime must actively choose it. There might also be changes in capital gains taxation or deductions. Not being updated can lead to incorrect calculations and missed benefits.
How to avoid: Stay informed about the latest tax amendments. Follow reliable financial news sources or, better yet, engage with a knowledgeable Tax Consultant Lucknow who stays abreast of all regulatory changes.
5. Incorrectly Claiming Deductions and Exemptions:
While it's important to claim all eligible deductions and exemptions (like those under Section 80C, 80D, HRA), making incorrect or unsubstantiated claims can invite penalties. For instance, false HRA claims without proper documentation (rent agreement, receipts, landlord's PAN) can result in severe fines. Similarly, claiming deductions without valid proofs will be disallowed during assessment.
How to avoid: Only claim deductions and exemptions for which you have proper supporting documents. Keep all proofs organized and readily available. If unsure about eligibility, consult an expert.
6. Not E-Verifying the ITR:
After successfully submitting your ITR online, the final crucial step is to e-verify it within 30 days of filing. Many taxpayers overlook this, rendering their filed return invalid. An unverified return is considered as if it was never filed.
How to avoid: E-verify your ITR immediately after filing using Aadhaar OTP, net banking, or by sending a physical ITR-V to the CPC, Bengaluru.
7. Missing the Filing Deadline:
Even with extensions, missing the deadline can lead to penalties (late filing fees), loss of the ability to carry forward certain losses, and the disallowance of certain deductions. While the due date for non-audit cases for FY 2024-25 is September 15, 2025, it's always best to file well in advance.
How to avoid: Mark your calendar with the due dates and aim to file your return well before the last day to avoid technical glitches or last-minute rush.
Get Expert Assistance from Chandnani & Associates!
Navigating the intricacies of income tax filing can be complex, and making even a small mistake can have significant consequences. This is where professional help becomes invaluable. If you're seeking reliable and expert guidance for your ITR filing in Lucknow, look no further than Chandnani & Associates.
As a leading Tax Consultant Lucknow and widely recognized as a best CA firm in Lucknow, Chandnani & Associates brings years of experience and in-depth knowledge to the table. Their dedicated team can help you:
- Choose the correct ITR form.
- Reconcile your financial data with AIS and Form 26AS.
- Ensure complete and accurate income disclosure.
- Understand the latest tax regime changes and optimize your tax liability.
- Maximize eligible deductions and exemptions.
- Ensure timely and error-free filing and verification.
By entrusting your ITR filing to Chandnani & Associates, you can gain peace of mind, avoid common mistakes, and ensure full compliance with income tax laws. Don't take chances with your taxes – choose the experts for a hassle-free tax season!
Location: 1st floor, 12-C, opposite Alambagh Inter College, Singar Nagar, Alamabagh, Lucknow, Uttar Pradesh 226005
Contact: 06393216050
Website: https://cachandnani.com/