All set to file your income tax return? Well, be extra careful this time. Under the new ITR rules, claiming false deductions or hiding income can cost you big. The Income Tax Department has said that if you are caught giving wrong information in your return, you could face a penalty of up to 200% of the tax due, 24% annual interest, and even prosecution under Section 276C.
This means a small mistake or a false claim can lead to a huge fine. To avoid trouble, make sure your income details and deductions are accurate. Read on to know what the new rules say and how to stay safe.
Common ITR Filing mistakes that can cost you heavily:
Even small errors in filing ITR can lead to a big trouble. Always double-check your claims and documents before filing. Here are some common mistakes that you should avoid:
ITR Mistake 1: Claiming deductions under Section 80C without having proper bills or proof
ITR Mistake 2: Choosing the old tax regime to get deductions, then switching to the new one laterITR Mistake 3: Showing fake house rent allowance (HRA) claims without rent agreement or landlord’s PAN
ITR Mistake 4: Listing personal spending as business expenses
ITR Mistake 5: Not reporting extra income from freelancing, crypto, or side jobs
Tips to avoid ITR penalty
- The most trusted way to avoid any penalty on your ITR is to have your proof ready for the claims that you have made. The proof needs to be legitimate, which means don’t mess with your form by claiming false things.
- Secondly, match your income tax details with your Annual Information Statement.
- Make sure you declare all your income sources.
- Keep the deadline in mind. Don’t forget file your ITR within the du date.
ITR Filing: Commonly asked FAQs
- Can you avoid penalty by filing a revised return?
No. If the tax department finds that you tried to mislead, revising your return won’t help.
- What if your CA or consultant makes a mistake?
Even in the event of your CA or consultant making a mistake, you are still responsible for those mistakes. The law holds the taxpayer accountable, not the person who prepared the return.
- Is this penalty only for salaried people?
No. The rule applies to everyone—salaried individuals, freelancers, professionals, and businesses.
