Don't Let These Common Income Tax Filing Mistakes Trip You Up!
Discover the top income tax filing mistakes that could cost you money and how to avoid them. Don't miss out!
Table of Contents
- Not reporting all sources of income
- Not claiming deductions and exemptions
- Missing deadlines for filing returns
- Incorrectly calculating taxable income
- Not maintaining proper documentation
- Filing under the wrong tax regime
- Errors in providing bank account details for refund
- Forgetting to tally Form 26AS
- Failing to review and double-check your return before submission
Hey there, tax-filing friend! Today, we're going to chat about the do's and don'ts of filling out your income tax return in India. It's important to get it right to avoid any unnecessary headaches down the road. So, let's dive into the 10 common mistakes you'll want to steer clear of!
Not reporting all sources of income
When it comes to income tax returns, transparency is key. Make sure you're reporting all sources of income, including Dividends, Bank FDRs Interest, rental income, and any other earnings. Leaving out any income can lead to penalties and unnecessary stress during the tax assessment process.
Not claiming deductions and exemptions
Don't leave money on the table! Make sure you're taking advantage of all deductions and exemptions available to you. This can help reduce your taxable income and ultimately, the amount of tax you owe. Common deductions include HRA, LTA, and investments under Section 80C.
Pro - Tip : You can pay rent to your parents and claim the deductions.
" Make sure to avoid these common income tax filing
mistakes to keep your finances in check and stress-free! "
Missing deadlines for filing returns
Deadlines are crucial when it comes to filing your income tax return. Different deadlines apply to different types of taxpayers, so make sure you're aware of when your filing deadline is. Missing the deadline can result in penalties and interest charges, so mark your calendar and file on time!
Incorrectly calculating taxable income
Calculating your taxable income can be tricky, but accuracy is key. Make sure you're including all the necessary components, such as income from all sources, deductions, and exemptions. Double-check your calculations to ensure you're reporting the correct taxable income.
For example there is different rate for Long term capital gain and short term capital gain earned from share trading.
Pro Tip- You can invest your long term capital gain in residential house and save tax on the same.
Not maintaining proper documentation
Keep all your tax-related documents safe and organized. This includes proof of income, investment statements, Form 16, and receipts for deductions claimed. Proper documentation not only helps during the filing process but also serves as a record in case of any future audits or scrutinizes from the department.
Filing under the wrong tax regime
With the introduction of the new tax regime, taxpayers now have a choice between the old and new tax regimes. Make sure you understand the implications of each regime before making a decision. Consider factors such as deductions, exemptions, and your income level to determine the most suitable regime for you.
Understand the difference between new and old scheme.
Errors in providing bank account details for refund
Ensure you provide accurate bank account details when filing your return, especially if you're expecting a refund. Incorrect details can delay the refund process or even lead to your refund getting credited to the wrong account. Double-check your bank account information to avoid any such errors.
Pro - Tip- While filling out the ITR first validate your bank account on income tax portal then file your ITR.
Forgetting to Tally Form 26AS
Form 26AS is a crucial document that provides details of your tax deducted at source (TDS) and other tax-related information. Make sure to reconcile Form 26AS when filing your return to ensure the accuracy of your tax calculations. Failing to do so could lead to discrepancies and delays in processing your return and Refunds.
Failing to review and double-check your return before submission
Before hitting that submit button, take some time to review your tax return thoroughly. Check for any errors, omissions, or discrepancies in your return. By double-checking your return, you can catch any mistakes and make necessary corrections before filing, ensuring a smooth and hassle-free tax-filing process.
Don't let these common income tax filing mistakes trip you up! By avoiding these errors and taking the necessary precautions, you can file your tax return accurately and efficiently. If you're unsure about any aspect of your tax return, consider seeking professional help to ensure you're on the right track. Happy filing, and here's to a stress-free tax season!
Though the ITR filling is not the DYI (Do It Yourself) Project, always seek professional's advice.