ITR filing FY 2024-25: These 7 income tax mistakes can get you a tax notice

To avoid unwanted notices, it's important to file your ITR carefully, double-check all information, and stay updated on the latest tax laws.

The income tax return (ITR) filing deadline is near, and with it, the anxiety of taxpayers filling up their documents and reaching the income tax portal. But in the frantic rush to get it done on time, most make avoidable mistakes that can trigger a notice from the Income Tax Department. Tax officials have been increasingly relying on data from banks, mutual funds, stock exchanges, and GST returns to single out discrepancies in returns. Even a small mismatch can attract scrutiny.

Seven of these most typical mistakes can land you in trouble:

1. Not reporting all the incomes

Taxpayers have a tendency to ignore interest income on tax-saving bonds, fixed deposits, or savings accounts. Income from stock trading, mutual funds, and renting houses needs to be reported even if they are tax-free or less than the basic exemption amount.

2. Not reporting foreign income or assets

If you own foreign property, a foreign bank account, or you've invested in foreign financial products, all these are required to be disclosed. Non-disclosure of foreign assets is a serious tax evasion under the Black Money Act.

3. Discrepancy with Form 26AS or AIS

Your TDS and high-value transactions are captured in Form 26AS and the Annual Information Statement (AIS). Your ITR would be reflected in this, otherwise.

4. Incorrect deductions

Requesting deductions under Section 80C, 80D, or interest on home loan without proof or exceeding the specified limit may lead to rejection or questioning of your return.

5. Filling out the wrong ITR form

Filing incorrect ITR form (e.g., filing ITR-1 when you have capital gains) makes your return defective and prone to notice for rectification or re-filing.

6. Concealment of exempt income

Even though income such as PPF interest or agricultural income is exempt, it has to be disclosed in the return. Not doing so may amount to concealment.

7. Failure to verify the return

After being filed, your ITR will need to be verified—through Aadhaar OTP, net banking, or by sending a signed paper copy to CPC. If not verified within 30 days, the return is rendered invalid.

To avoid unwanted notices, it's important to file your ITR carefully, double-check all information, and stay updated on the latest tax laws.

FAQs

Q1. What if I receive a notice from the Income Tax Department?

You'll have to respond within the time specified. As per the nature of the notice, you might be requested to provide documents, make a correction to your return, or pay due tax.

Q2. Can I correct my ITR once I've filed?

Yes, you can file a corrected return at the end of the assessment year (i.e., March 31, 2026 for FY 2024-25) if you find an error or missing information.

Q3. What is AIS and how do I use it?

Annual Information Statement (AIS) is a consolidated report of your transactions. Cross-match your ITR with AIS while filing and match appropriately to prevent discrepancies.