The financial year 2023-24 ended on 31 March 2024 and individual taxpayers are gearing up to file tax returns by the deadline of 31 July 2024. Over the past few years, the government has sought to improve the taxpayer’s experience by simplifying tax return filings through pre-filed ITR, etc.
With some useful tips listed below, taxpayers can ensure that their returns are filed accurately and they can also avoid potential queries from the income tax department, and other issues.
Filing your Income Tax Return (ITR) correctly is crucial to avoid any scrutiny or notices from the Income Tax Department. Here are ten essential tips to help you file your ITR smoothly for FY 2023-24:
1. Accurate Personal Information
- Verify PAN and Aadhaar: Ensure that your PAN and Aadhaar details are correctly mentioned. They must be linked as per the latest regulations.
- Correct Bank Details: Enter accurate bank account details, including the IFSC code, for refunds and other communications.
2. Use the Correct ITR Form
- Select the Right Form: Use the appropriate ITR form based on your income sources. Using the wrong form can lead to rejection or the need for revision.
3. Report All Sources of Income
- Disclose All Income: Include income from all sources like salary, interest, rental income, capital gains, freelance earnings, and any other sources.
- Include Exempt Income: Even though exempt income like agricultural income doesn’t attract tax, it must be reported.
4. Claim Deductions and Exemptions
- Section 80C, 80D, and Others: Ensure you claim all applicable deductions and exemptions. Keep proof of investments and expenses.
- HRA and LTA: Properly calculate and claim House Rent Allowance (HRA) and Leave Travel Allowance (LTA) if applicable.
5. Match Form 26AS with Income
- Verify Form 26AS: Ensure the income and TDS details in Form 26AS match with your records and the amounts you are reporting in your ITR.
- Reconcile Differences: Address any discrepancies before filing your return to avoid mismatch issues.
6. Include Interest Income
- Savings and FDs: Report interest earned from savings accounts, fixed deposits, and recurring deposits.
- Form 16A: Cross-check TDS certificates provided by banks with your records.
7. Report Capital Gains
- Short-Term and Long-Term Gains: Declare all capital gains from the sale of assets like stocks, mutual funds, and property.
- Carry Forward Losses: Utilize the benefit of carrying forward any previous years’ losses to set off against current year gains.
8. Avoid Incorrect Tax Calculation
- Recheck Calculations: Use reliable software or consult a tax professional to ensure accurate tax computation.
- Include Advance Tax and Self-Assessment Tax: Make sure any advance tax or self-assessment tax paid is correctly accounted for.
9. Ensure Proper Documentation
- Keep Proof Ready: Maintain all documents related to income, deductions, and investments.
- Support Your Claims: Be prepared to produce documents if requested by the tax authorities.
10. File Before the Deadline
- Timely Filing: Submit your ITR before the due date to avoid penalties and interest.
- E-Verify Your Return: Complete the e-verification process immediately after filing to validate your return.
By following these ten steps, you can ensure a hassle-free ITR filing experience and minimize the risk of receiving an income tax notice. Proper preparation and attention to detail are key to staying compliant and avoiding any issues with the tax authorities.
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