Slowdown in access to AIS, ITR e-filing portal, resulting in delays, say chartered accountants

Section 50 of the Black Money Act penalises a person if the said individual fails to furnish any information of an asset located outside India including their financial interests (like shares/bonds, etc).

Monsoons in parts of India and a technical slowdown in downloading the Annual Information Statement (AIS) and Tax Information Statement (TIS), have led to delays in filing income tax returns.

Chartered accountants based in Maharashtra, Karnataka and Gujarat have confirmed that despite a short 20-day run left for the July 31 tax return filing deadline (for non-audit), the usual rush to file ITR is missing.

“There is a general delay in filing tax returns this year,” says Mayank Mohanka, Founder Director and Partner at TaxAaram India.

The delay is being blamed on three factors – technical glitches on the portal, the dynamic nature of AIS and the delay in sharing the Form 16 by some companies (despite the statutory June 15 deadline).

As per statistics shared by the Income Tax Department, 2.22 crore returns have been filed as on July 10, 2024. So, 5.61 crore returns are to be filed in more than a fortnight, if we compare it with 7.83 crore returns filed by individuals for the assessment year 2023-24 (financial year 2022-23).

Technical snags galore

When Moneycontrol reached out to a dozen chartered-accountancy firms, they confirmed that the process this year has been adversely affected due to delays in accessing relevant tax information pertaining to individual tax-payers.

“We have been facing difficulty in accessing the AIS and TIS for many clients due to the delay caused by the functionality of the tax-filing portal server,” says Ahmedabad-based Chartered Accountant Raju Shah.

Due to the vast information contained in the AIS, individuals avoid filing returns without the information in the AIS to avoid unintended complications.

Also read: A step-by-step guide to paying income tax using your credit card

Hurdles in tax payment

Even payment of taxes has been an issue as the same income tax portal is being used for every aspect of tax filing and payment instead of the NSDL website, which was used for payment of taxes until 2022.

“Income tax portal is not functioning properly. On several occasions, the ‘e-pay tax’ functionality has not been working, profile details are not reflected, filed forms and the returns section are blank,” says Shweta Ajmera, Founder S Ajmera & Co.

Delay in access and changes in AIS

Even in the last month to file returns, information received from banks, mutual fund houses, electricity boards, gold jewellers and various vendors is either missing or still being corrected. This often leads to the information captured against individual permanent account numbers (PAN) being altered on a continuous basis.

“The information on specified financial transactions (SFT) that is provided by financial services and other companies should have been filed latest by May 31. But many entities have not yet filed their SFT returns, impacting assessees’ AIS. This is leading to individuals being unable to file their returns. Altering the deadline for SFT reporting to April 30 instead of May 31 every year would help us avoid such problems in future,” says Ajmera.

The changes in the AIS mean that if the numbers don’t match, then tax-payers might have to deal with queries from the I-T department.

Paras Savla, Partner at KPB & Associates, says, “If any income has been omitted from the return,  one may need to provide an explanation for the mismatch and might have to file a revised return to include the unreported income. If there is a notice issued for the mismatch after filing the tax return, then you should respond to the notice.”

Also read: Avoiding double-taxation: How Form 67 can help you claim foreign tax credit

Tasks to be completed

There have been cases where individuals have not received their forms-16. “Even though my Form 16 was issued last week, the figures mentioned were wrong and they recalled the same. There is an issue due to tax regime change, which they failed to consider,” a Mumbai-based advertising executive told Moneycontrol on the condition of anonymity.

Even if you have not received your Form-16, there are other areas of a return you can still work on. Check the AIS and the Form 26AS to ascertain whether the information reported by the respective companies under SFT transactions are accurate.

If your taxes have been paid and are being reflected accurately and there is no mismatch in the Form 26 AS details, then you can go ahead and file the returns.

“Details of the income received can be procured from the salary slip, the only difference being that the standard deduction amount and the net salary wouldn’t be evident. Since the employer has already filed his Form 27D, the tax collected would be reported under the Form 26 AS and AIS,” says Homi Mistry, Partner, Deloitte India.

Returns can be primed

Form-16 contains limited information about salary break ups and perquisites. But beyond these fields, the other information one can source is the interest income, capital gains from shares or house property. Even donations and their ARN numbers can be sourced.

You can keep your returns more or less ready. “Details such as capital gains, house property income can be sourced and added to the returns as these aren’t dependent on Form 16,” says Mistry.

Also Read: Missing Form 10BE: Why donors are forgoing tax deduction benefits

Trace foreign income

If you are someone who has income from foreign shares or investments, then gather these details. Even though a snapshot of the Indian income is reported in Form 26AS and AIS, foreign income will not be mentioned.

“Source the tax paid certificate from the countries where you have earned foreign income. Get them translated if they are in a language (for instance, Chinese or Italian) other than English. There are schedules to be filed if you have foreign income,” suggests Mistry.

Additionally, the financial year for different countries do not correspondent to the April 1-March 31 period, so the proportionate income will have to be tracked. For instance, in the UK, the financial year starts from April 6.

Also Read: ITR filing: Know the changes in income tax return forms for FY24

Don’t forget to claim the TCS refund

You would have to claim the 20 percent tax collected at source (TCS) if you used travel agency services for foreign travel exceeding Rs 7 lakh per annum or invested abroad and haven’t claimed the TCS refund in advance tax. The tax returns are your final opportunity to claim the tax refunds.

“Tax collection at source would have been effected not just during foreign travel, but also while purchasing cars. Earlier the TCS and TDS were auto filled,” says Karan Batra, Founder of CharteredClub.com

If there is an error in the TCS amount mentioned then you would also have to head back to the collector and request a change, which could be a time-consuming affair.