Impact of Errors made while Filing Returns
·
Returns
can be classified as defective u/s 139 (9) and in some scenarios the return can
be declared in valid / Non Est. ITD is not introducing this concept to cover
certain types of errors in order to prevent future grievances
·
Computation
Errors - In
electronic filing it has been noticed that most of the errors are due to data errors
as filed by the assessee. This includes non filling of key schedules, wrong
details etc resulting in rectification requests etc which delay closure of
processing
·
Inability
to pay refunds to the assessee
Key rules to be followed to ensure trouble Free Processing
·
Once
E filing is done (without digital signature), ITR V needs to be sent in time to
CPC. In case ITR V acknowledgement is not received within reasonable time, the
assessee may call up the CPC call centre to verify status. Nearly 10% of
assessees have failed to send the ITR V to CPC after E filing.
·
Assessee
needs to fill his email address, mobile No. correctly to ensure appropriate
communication from the Income Tax Department. The use of the Tax Practitioner/CA's
email address may not be appropriate.
·
The
assessee should make sure the correct (latest) address, bank account, MICR no.
is filled
·
The
assessee should verify tax credits available in Form 26AS/NSDL websites.
Mismatches are the single largest cause of incorrect tax computation. Non
credits may be taken up with the TDS deductor and/or the banker as soon as they
are noticed
Dos & Don't - ITR 1-7
Part A - Personal Information Schedule
·
Name: Has to match the PAN database
· Date
of Birth: Mistakes here will result in
computation of higher taxes in case of senior citizens
·
Address: House/Flat no, City, PIN Code,
are mandatory fields. Non filling will result in refund delays
· E-Mail
Address: Needs to be filled correctly, is
the basis of all communication from CPC. Mistake will result in non receipt of
all intimations from CPC. Use of Auditor/Tax practitioner's ID may be avoided.
· Mobile
No: Full Mobile No. without use of
+91 needs to be entered. This is essential for all SMS based communication
· Sex: Should match the PAN database.
If PAN database is wrong, it results in mistakes in computation
· Status: Should be correctly filled
· Residential
Status: the status of NOR and NRI should
be mentioned only where applicable as they are not eligible for certain
benefits available to resident assessee
Part B - TI
·
Salary
amount entered in BTI should be same as in TDS Salary and final value in Schedule
salary.
·
CYLA
or BFLA loss has to be mentioned in the appropriate rows, else loss will not be
allowed.
·
In
STCG many users confuse between STCG under section 111A and STCG others and
enter against one another leading doubling to income from Capital Gains.
·
In
case of HP loss, BTI value for Income HP should be 0 or null and final value in
schedule HP should be a loss
·
It
is not enough if just part B TI is filled. Respective schedules also need to be
filled for Eg. Schedule HP, Sch Depreciation etc. Else the return can be
treated as a defective return u/s 139 (9).
Part B - TTI
·
Relief
under 89,90,91 is to be entered ONLY if applicable. The value entered in
schedule TDS, IT and TCS has to be entered in Part B TTI also. Eg. Schedule IT
is entered but in no amount is mentioned in this section as Advance Tax or SAT.
·
The
Bank account no. has to given correctly and entered even if no refund is due.
This is to ensure that refund arising from recomputation of income by the ITD
can be paid to the assessee. The A/c no and the name in the bank account has to
tally.
·
The
MICR No. should be in 9 DIGITS and first 3 digits of MICR code denotes the
place of residence as mentioned in address's PIN Code.
·
Eg.
560056025- '560' refers to Bangalore whose PIN starts with 560 000. The
assessees may avoid giving bank accounts where MICR starts with '0'.
Income Schedules Salary, HP
·
Net
Salary should be entered and not Gross Salary. This will result in higher taxes
·
The
Salary value should tally with that entered in Schedule TDS
·
In
Schedule HP, the loss from house property has to be entered with all mandatory
details of the property including details as to whether it is let out. Entering
only the loss as summary makes it incomplete
·
Co-owners
of property should enter only the income pertaining to their share in the
property. Entering the gross rental receipt and thereafter offering this share
of income from such rental will increase total income
Capital Gains
·
Deemed
Capital Gains arising out of Schedule deprecation should be considered by the
assessee in schedule CG.
·
Non
filing of full value of consideration or filling only expenditure under various
sub categories of CG leads to incorrect computation of income.
·
Filling
of only cost of acquisition also leads to incorrect computation.
·
The
quarterly breakup of capital gains in the CG schedule should be post set off of
all losses.
·
Filling
of accurate quarterly breakup is necessary for computation of interest under
234C.
·
Correct
section codes should be used depending upon the type of capital gains income in
the SI schedule.
·
Exempt
LTCG should not be entered in CG schedule as well as in BTI, it has to be
mentioned in Schedule EI
Schedule BP
·
PBT
should NOT BE included Deprecation value
·
Income
from speculative business included in PBT should be shown separately in Sl. 2
and Sl. 38 of schedule BP.
·
Income
offered under other heads other than BP included in P&L should be reduced
in Sl. 3 of Schedule BP.
·
All
disallowances in Part A OI should be considered in Schedule BP.
·
Income
offered under section 44AF (Deemed Income) if included in PBT should be reduced
in Sl. 4 of Schedule BP.
·
Deprecation
as entered In P&L should be shown in Sl.11 of Schedule BP alone and not in
Sl 22 or 7 or another row in BP. The schedule DPM, DOA should be mandatorily
filled.
·
Assessee
claiming benefit of rule 7A 7B 7C should mention appropriate code in nature of business
schedule.
·
PBT
in P&L and PBT shown in sl. No.1 of Schedule BP should be same.
·
Specific
schedule for ESR, 10A etc should also be filled when a claim is made in
schedule B
SCHEDULES DPM, DOA, DCG AND DEP
·
All
the relevant values to arrive at the deprecation mentioned in Schedule BP is to
be filled in Schedule DPM, DOA.
·
DCG
arising out of depreciation schedules should be accounted for in CG and taxes
paid.
·
The
value of depreciation as per Schedule DEP and value mentioned in Schedule BP
should be the same.
Chapter VI A, MATC
·
In
case of deductions where separate schedules is also required to be filled, the
same should be FILLED WITHOUT FAIL- Eg. 80G, 80IA, 80IB, etc. Deductions will
not be allowed If specific schedules are not filled,
·
Entering
of only total deductions alone in Schedule VIA total will not be result in
wrong computation of deductions. Section wise (amount claimed for 80C, 80IA,
80G etc) should be broken up and mentioned in as per the schedule
·
To
compute and avail MAT credit in MATC, sl. No. 1 to 6 should be filled with
relevant details and the final value should be claimed in sl. No. 7 (Lower
value of that in Sl.No. 3 or Sl. NO 6) should be specifically filled.
Schedule CYLA
·
Loss
sought to be adjusted should be claimed against a specific income and also
under the loss to be adjusted heading. If lottery income is offered as part of
OS income, the value to the extent of lottery income should be excluded while
claiming income from OS in CYLA.
·
The
respective schedules should also contain loss details for CYLA.
Schedule CFL
·
Date
of filing of return for relevant year in CFL should be filled.
·
Loss
details should be entered under respective income sources.
Schedule BFLA
·
Specific
differentiation in allocating the losses under BFLA should be made and the
claim of adjustment should be made based of the relevant heads
Schedule SI (Special Income) & Schedule EI
(Exempt Income)
·
The
assessee has to verify the nature of special income and enter appropriate
Section Code. Entering wrong section code can lead to consideration of the
incorrectly offered income for taxation
·
The
assessee needs to bifurcate incomes taxable at special rate and normal rate and
if there is no provision in respective schedules like CG or OS, he/she has to
offer income chargeable at special rate- they need to be disclosed on in
Schedule SI.
·
The
income exempt from tax shown in P&L or BP or BTI should also be filled in
EI and they should tally.
Schedule TDS and TCS
·
TDS
on salary should be claimed ONLY in schedule TDS Salary (ITR1) or TDS1 (ITR
2-4).
·
TDS
on Interest should be claimed ONLY in TDS on interest(ITR 1) or TDS2(2-4).
·
Claiming
of TCS claims in TDS schedules and vice versa will lead to mismatch translating
into excess demand or lower refund The claim of TDS amount should be made in
TDS deducted as well as TDS Claimed for the year columns in schedule TDS2 and
TCS.
·
TDS
claims should tally with Form 26AS or NSDL database which are accessible very
easily.
Schedule IT
·
Dates
of deposits should be entered in DD/MM/YYYY format and not in any other format
like MM/DD/YYYY format. This will lead to mismatches
·
Exact
amount paid in the challan should be claimed in return- rounding off to nearest
10 or 100 leads to mismatch.
·
Individual
payments should be separately claimed. Clubbing of multiple challans or
entering consolidated payment will lead to mismatch.
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