As the extended deadline of filing Income Tax Return (ITR) for the financial year 2019-2020 i.e. assessment year 2020-2021, is fast approaching, I wish to point out certain common mistakes which you need to avoid while filling up ITR forms specially who those who file it themselves.

Update your basic contact details

The income tax department sends almost all the communications through emails and mobile phones. Therefore it is important to ensure that the your latest phone number and emails id are updated in income tax department records. It is specifically relevant and important in case you have changed your mobile number or emailed recently. A few of salaried use their official email id and phone number for tax purpose which, in my opinion, they should avoid as it does not remain accessible once you change your job. So before you actually start filling up the ITR form, please verify that the contact details registered with income tax department are functional and latest.

Bank account details

Presently the income tax refunds are directly credited to the bank account which is pre-validated. So it is important for you to verify which bank account is pre-validated. In case no account is pre validated or the one which is pre validated is not longer in use, ensure to pre validate the bank account which is operative and where you want your income tax refund to be credited. In case you are contemplating closing any of the existing bank account like the salary account of an earlier employer, please do not select the same for receiving the refund.

Details of TAN of the tax deducutor and taxes paid

Since we are not allowed to attach/upload any document with ITR including the document for proof of payment of taxes, the credit for taxes paid is granted on the basis of records available with the tax department and which is reflecting in your form no. 26AS. Though the details of TDS are generally prefilled in some of the ITR forms, you still have to be careful while furnishing details of the deductor in case the details are not fetched directly. In case you commit any mistake in mentioning TAN details of deductor in your ITR, in all likelihood you will not get the credit for such TDS at the time of processing of your ITR. This will result into unnecessary work for rectification request and delay in receipt of refund if any.

In case you have paid advance tax and or self assessment, you may have to furnish the details of such payments like challan number and BSR code for such payment. So in case of any small mistake, you may not get the credit at the time of processing your ITR.

Details of capital gains

In case you have earned any capital gains during the year, you have to be very careful while filling up the details of such capital gains. The schedule in respect of capital gains is very complicated for a layman to understand and to be able to fill up correctly. For capital gains you are required to pay the advance tax on the due date of advance tax falling due after such transaction. So you have to provide the break up of capital gains corresponding to the due dates of advance tax. Be careful while filling up the break up of capital gains in ITR, failing which you may have to pay more interest than what is due. Likewise one has to submit the break up of the short term capital gains and long term capital gains on the basis of rate of tax applicable under various sub heads. So you have to be extra cautious while furnishing these details in capital gains schedule. Any mistake will result in wrong tax liability. In case you have many transactions of capital gains or you have sold any property during the year, I will strongly advise you to avail the services of a professional to help you file your ITR rather than you doing yourself.

Details of foreign bank accounts

Since Indian have become very mobile nationally as well internationally and go abroad for various purposes like education, deputation or for onsite job or holidays. So there is all probability of you having opened a bank account during your stay there. There is also strong probability of you having come back to India without closing such account even though no significant balance is left in the account. As per the Indian tax laws all the tax resident of India have to furnish details of all foreign assets including bank accounts irrespective of the balance. In case you are resident of India and otherwise eligible to use ITR 1, you should not use ITR 1 in case you have any investment abroad. Be careful while filling up the details in case you have any asset including investments in shares, mutual funds abroad.

I am sure with this discussion you are in a better position to avoid small but mistakes having huge impact.

The writer is a tax and investment expert and can be reached on [email protected]

(Republished with Amendments)

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  1. g.deenadayalan says:

    Somebody has uploaded their transaction against my pan no. The entries are appearing in Form 26 AS . I am finding it difficult in filing my returns before 31.12..20. me.

  2. Narayan says:

    I am Sr.Citizen age 69 yrs.Having income frm pansion Rs. 37000/-p.m. and interest received from banks on my fixed deposits about Rs. 250000/-.I have to file ITR for A.Y.2019-20.I have kept Rs. 150000/- as fixed deposit u/s.80ccc. What are the deductions I can claim? Pl. guide.

  3. venkat says:

    “So in case you commit any mistake in mentioning the TAN number of the deductor in your ITR, you will not get the credit for such TDS at the time or processing of your ITR and thus unnecessarily having to make request for rectification of mistake.” .\
    The IT authorities must be verifying the TDS details submitted by taxpayer from the 26AS. If there is some minor error like in TAN of deductor and if other details are ok why not IT authorities themselves correct them.

  4. D.K.Jadhav says:

    I am working in MTNL, Mumbai and staying in company quarters. I am not getting HRA and I pay maintenance charges of Rs. 580 per month. Quarters is not provided as rent-free or concessional rent accommodation
    Company is treating t as Perquisite and Perquisite tax applied. But IT Act 17(2) says If it is rent-free or concessional rent accommodation than it should consider for tax. What is right. Please explain

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March 2021