What is Income Tax Return & How to file ITR?
Filing Income Tax returns can be a tiring job as it involves submitting a large number of documents and is a long process. If an individual provides wrong information or commits mistakes un-deliberately while filing his/her income tax return, then it may lead to complications in the future and he/she has to provide clarification to the Income Tax Department along with the right and corrected details. An individual has to file his ITRs annually according to the law and it does not matter whether the concerned individuals are earning their annual income through a monthly regular income or capital or any other sources. The Income Tax Returns are to be filed within a set time period before a fixed deadline. Nowadays due to digitalization on a rise in India, ITR can be filed online too. Hence, there is no need to visit the Income Tax department to file your income tax return. You can file it easily by filling in an online application form. However, people tend to make a lot of mistakes while filing Income Tax returns. Read our list of the most common five mistakes made while filing Income Tax returns and try to avoid them while filing yours.
5 Common Mistakes to avoid while filing ITR
Incorrect Personal Information
While filing your Income Tax Returns, provide correct personal details regarding your name, email address, and postal address. All the necessary information, notifications, and circulars are provided at the individual’s postal address and if you happen to make even a minor mistake while providing personal details in the Income Tax Returns form, then the Income Tax Department will not be able to communicate with you regarding any latest information. You will not be able to get information regarding your Income Tax Returns form.
Incorrect number of income sources
This is also a mistake that Income Tax filers tend to make while filing Income Tax Returns. All the different sources of income for example – income from personal salary, income from rent on a property, etc. are all described under the Income Tax Returns Act. You have to carefully include all your income sources category-wise. According to these sources of income, an individual is responsible to pay his/her Income Tax Returns accordingly.
Tax on House Property
People tend to make the mistake of not paying text on the house properties they own more often. If you own a house other than the one you are residing in, then you are responsible for paying the Income Tax Returns for that other house/houses. According to the law, it doesn’t matter whether you have given to house on rent or not, your unoccupied house properties also come under this section. SO, do not make this mistake of forgetting to mention your multiple house properties while you are filing your Income Tax Returns.
Wrong type of form
There are different types of forms available for different kinds of Income Tax Returns filing. Many people make this simple yet common mistake of choosing the incorrect type of form for filing their Income Tax return. There are many different types of forms issued by the Income Tax Department for example like ITR1 form and ITR-4 form. So, choosing the right form to file your Income Tax Return is very important and you should not make a mistake while choosing the form.
Leaving out exempted Income
According to the law, some types of income are exempt from giving income tax. For example income from long-term gains, dividends, etc. by the Income Tax Department. But this provision does not mean that the individual benefiting from this Income Tax exemption is not responsible for providing this information to the Income Tax department. People often make the mistake of not informing about this income tax exemption. Avoid these commonly made mistakes and report all your income tax exemptions’ information while filing Income Tax returns.