What will happen if you fail to rectify ITR errors before the due date?

Filing of Income Tax Return (ITR) before the July 31 deadline is important for taxpayers to avoid penalties. But in case you file an ITR with some mistakes and fail to rectify it before the due date, there is no need to panic. Tax experts say that you will be able to rectify ITR errors by filing a revised return even after the due date.

“A taxpayer, who discovers any omission or any wrong statement made in his/her original ITR shall be eligible to file revised return u/s 139(5) of the IT Act. Moreover, such a revised return can be filed on or before three months prior to the end of the relevant assessment year (i.e., 31st December 2023 for AY 2023-24) or before the completion of the assessment, whichever is earlier,” says Dr Suresh Surana, Founder, RSM India, a tax consultancy firm.

“Further, such taxpayer may also consider the filing of updated return u/s 139(8A) of the IT Act within 24 months from the end of the assessment year subject to certain specified conditions and payment of additional tax u/s 140B of the IT Act. Such an updated return, however, cannot be filed in cases where such an updated return is a loss return or in case any search, survey proceedings, etc. have been initiated,” he adds

Common errors made by ITR Filers

While filing their returns, taxpayers often make some common mistakes. Dr Surana says as the due date of filing ITR for individual taxpayers is fast approaching, individuals in a haste to file their returns, may end up making the following errors:

Selecting Incorrect ITR Form

The taxpayer may misinterpret the eligibility criteria while selecting ITR form applicable to him/her and end up choosing wrong ITR form, which shall lead the return to be treated as defective or make the ITR invalid altogether.

Also Read: Income Tax Return: 10 ITR filing mistakes which can cost you dearly

Quoting incorrect personal details

Taxpayer may furnish inaccurate PAN, Aadhar and correspondence details. or provide wrong bank account number and IFSC code while quoting bank details which may delay income tax refunds.

Pre-validation of bank account

The taxpayer may forget to pre-validate their bank accounts using their name, mobile number and PAN, which may also lead to a delay in receipt of Income Tax refunds.

Non- disclosure of exempt income or foreign income

Due to unawareness, taxpayers may fail to disclose exempt income or non-taxable income. Further, taxpayer being resident and ordinary resident may fail to report income earned from any foreign country since tax on same has been paid in the respective foreign country.

Mismatch between Form 26AS and AIS

Taxpayer may forget to reconcile Form 26AS with AIS and Form 16/ Form 16A and thereby ignore any discrepancies among them.

Apart from the above, taxpayers who switched jobs during the year may sometimes fail to take into account Form 16 issued by his/her previous employer.

Also Read: Can Senior Citizens and Super Senior Citizens benefit by filing Nil ITR before July 31 deadline?

Further, taxpayers may make errors while computing their capital gains as treatment of such capital gains varies on the basis of the type of capital asset, rate of tax, period of holding and other conditions applicable thereon.

Taxpayers may also fail to include interest received on income tax refunds under ‘income from other sources’. Also, it is seen that salaried taxpayers fail to report in Schedule Foreign Assets, the details of the ESOPs of foreign group companies held by them.