Mistakes to avoid while filing your Income tax returns
Anaika Foundation
August 23, 2023
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Don’t leave it for too late – the last date is 31st July 2023, but if you are a salaried employee and have already received your Form 16, then you should start the return filing process asap. Last minute the traffic on the Income tax site is very high and can lead to missing filing the return
Choosing the wrong form – based on our earlier post on what incomes are applicable to you, choose the right form in which you need to file the return –
ITR 1 – only salary income and income from other sources; one house property; income < 50 lakhs
ITR 2 – income > 50 lakhs; more than one house property even if self-occupied
ITR 3 – income from business or profession including if you do F&O trading
ITR 4 – presumptive income
Check 26 AS and Annual Information Statement (AIS) – check the information reported in 26AS and AIS
All TDS/TCS is reported in AIS should be taken into account
All high value transactions reflecting in AIS/26AS should be shown in the ITR while filing
Not reporting Interest income – the interest income will show up in the AIS and needs to be reported
Previous employer income – if you have had 2 or more jobs during the year, make sure to get FORM 16 from all companies and show all the incomes
Joint holdings – if any high value investments are done jointly in the name of your spouse or children, their returns also need to be filed
Compute correct capital gains –
Be aware if indexation is allowed or not on the capital asset you have sold
Find out if the holding period was for short duration or long duration
Based on the duration, the gains will either be clubbed in regular income or reported as capital gains
Rates for different asset classes are different for computing capital gains