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Common Income Tax Mistakes to Avoid When Filing ITR

September 19, 2017

Common Income Tax Mistakes to Avoid When Filing ITR

Every Indian whose income exceeds the exemption limit set by the government has to file their income tax return or ITR on the basis of the applicable income tax slab.

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To make the process of filing of IT return easier, the government launched e-filing website and created a system that’s easy to understand and use. However, people still make some common mistakes when filing their IT return which can lead to unnecessary complications. These are:

  1. Filling a Wrong ITR Form
    To file your income tax return, you have to select the right ITR form. However, it can be confusing because of the variety of ITR forms that are available. For instance, ITR-1 is to be used by a person who receives income only from a salary or a pension, but if they are receiving capital gain as well, then they have to use ITR-2. So, be sure to check which form is the right one for your situation and fill it accordingly.
  2. Sources of Income
    Many people prefer mentioning only those sources of income that are taxable. However, it’s advisable to mention the exempted income as well so that the IT doesn’t consider it as “concealment of income” and send a legal notice.
  3. Ignoring Form 26AS
    The details of the tax deductions (TDS) made by your employer can be found in the form 26AS on the IT department’s e-filing website. However, a large number of people never check it at all.

    It’s important to verify your income and tax details (deductions, etc.) with the form 26AS to identify discrepancies such as wrong PAN details, etc.

  4. Not Claiming Possible Deductions
    There are many ways to lower your final taxable income. For instance, you can deduct up to Rs. 2 lakh paid on your home loan interest from your taxable income during a financial year. You can also deduct up to Rs. 25,000 as medical expenses under Section 80D, etc. Ignoring these deductions can greatly increase your taxable income and increase the tax burden.

By learning about the income tax filing procedure and available benefits, you can avoid coming under the IT department’s scanner and lower your tax applicability as well.

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