Do I need to file income tax returns?
Yes, it is mandatory to file returns if your income exceeds the basic tax exemption limit, which is Rs 2.5 lakh for those below 60 years of age. Irrespective of your income, you must file returns if your foreign travel expenses in a financial year exceeded Rs 2 lakh or your electricity bill amount crossed Rs 1 lakh. The same is the case if you have foreign income or assets. Then, there are other conditions, too, that make filing of returns mandatory, irrespective of your income.
Why is it important to select the right income tax return (ITR) form?
A wrong ITR form will result in your returns being considered invalid. The income tax department has notified seven ITR forms for assessment year 2022-23 (financial year 2021-22). For individuals, the applicable forms are ITR-1 to ITR-4. For salaried taxpayers, ITR-1 and ITR-2 are the most relevant forms.
I missed submitting proof of investments to my employer in January. Can I claim these deductions while filing returns?
Yes. The deadline set by employers for submitting investment declarations to claim deductions under sections 80C, 80D, 80E and so on is January or February. However, many employees fail to meet the deadline for submitting proof of tax-saving investments. As a result, a higher amount of tax is deducted from the salary during the last three months of the financial year. If you missed submitting such proof earlier, you can enter the details in your tax return form and claim the deductions and refunds for any excess tax deducted.
What are the most common errors made while filing income tax returns?
Minor errors made when filing income tax returns can render them invalid. These errors could be as simple as not choosing the right assessment year. Remember, you will be filing income tax returns for financial year 2021-22 and, thus, assessment year 2022-23. Double-check your bank account details. Entering incorrect details could lead to a delay in getting your tax refund. Also, if you have switched jobs during 2021-22, do not forget to declare the salary paid by your previous employer in your ITR.
What if I forget to disclose some income that I had earned? Will the income-tax department send me a notice?
Some taxpayers forget to disclose certain income, even if unintentionally. This is the case particularly with salaried individuals who rely primarily on their Form 16, which does not contain details of capital gains, fixed or savings deposit interest income, for instance. While the detailed Annual Information Statement (AIS) that collates your financial transactions could prevent such mistakes, you need to be careful. If the income tax department detects this missing income, you could end up getting a notice. Ensure that you file a revised return as soon as you notice errors in disclosing any income.
Do I need to complete the verification process after filing tax returns?
Yes, this step is mandatory – return-filing won’t be considered complete until you verify the returns. You have to complete this process within 120 days of having filed your ITR. But many forget to do so even though the electronic process can be completed through simple modes such as Aadhaar-OTP or net banking in a matter of minutes. You can also download the ITR-V, or acknowledgement form, and send it physically to the income tax department’s CPC office in Bengaluru.
