E-filing of Income Tax Returns (ITR) has simplified tax compliance for individuals and businesses in India. However, mistakes in the filing process can lead to delayed refunds, penalties, or even legal scrutiny. Whether you’re a salaried employee, a freelancer, or a business owner, avoiding common errors ensures a smooth tax filing experience. This guide highlights frequent mistakes taxpayers make while filing their returns and how to prevent them.

Why is Accurate E-Filing Important?

Filing your income tax return correctly is crucial because:

• Incorrect filing can result in tax notices or penalties.
• Errors may delay refunds or cause them to be denied.
• Your tax return serves as an essential financial document for loan approvals, visa applications, and business transactions.

Common Mistakes in ITR E-Filing

1. Choosing the Wrong ITR Form

Each category of taxpayers has a designated ITR form. Filing the incorrect form may lead to rejection or non-processing of your return.

✅ How to Avoid:

• Identify your correct ITR form based on income sources.
• Salaried individuals should use ITR-1 (Sahaj) if their income is under ₹50 lakh.
• Business owners and professionals should opt for ITR-3 or ITR-4, depending on whether they opt for presumptive taxation.

2. Incorrect Personal Details

Errors in PAN, Aadhaar, name, or bank account details can result in failed verification or delayed refunds.

✅ How to Avoid:

• Cross-check personal details before submitting the return.
• Ensure the PAN and Aadhaar are linked, as it is mandatory for filing ITR.
• Verify your bank account details and pre-validate them for direct refund credit.

3. Not Reporting All Sources of Income

Many taxpayers forget to include:

• Interest from savings accounts, fixed deposits, or recurring deposits
• Rental income from properties
• Freelance income or earnings from part-time jobs
• Capital gains from stock trading or cryptocurrency transactions

✅ How to Avoid:

• Check Form 26AS and AIS (Annual Information Statement) for all reported incomes.
• Maintain records of all income sources, even if TDS has been deducted.

4. Failing to Reconcile Form 16, Form 26AS, and AIS

• Form 16 is issued by your employer, showing TDS deducted on salary.
• Form 26AS is a tax credit statement that includes all TDS deductions.
• AIS (Annual Information Statement) shows all reported financial transactions.

Discrepancies between these documents can trigger scrutiny from the tax department.

✅ How to Avoid:

• Compare your salary details in Form 16 with Form 26AS.
• Ensure all TDS deductions match across the forms.

5. Missing Out on Deductions and Exemptions

Many taxpayers fail to claim deductions under various sections, leading to higher tax liability.

✅ How to Avoid:

• Claim deductions under:
  • Section 80C – Investments in PPF, EPF, ELSS, NSC, LIC, etc.
  • Section 80D – Health insurance premiums.
  • Section 80E – Education loan interest.
  • Section 80G – Donations to eligible charities.
  • HRA and LTA for salaried employees.

6. Not Verifying the Return

Many taxpayers assume that once the return is filed, the process is complete. However, ITR verification is mandatory to process your return.

✅ How to Avoid:

• Verify your return within 30 days via:
  • Aadhaar OTP
  • Net banking
  • Demat account EVC
  • Sending signed ITR-V to CPC, Bangalore

7. Incorrect Computation of Taxable Income

Miscalculating total taxable income can result in overpayment or underpayment of taxes.

✅ How to Avoid:

• Use the Income Tax Calculator available on the Income Tax Portal.
• Ensure accurate inclusion of allowances, deductions, and exemptions.

8. Failing to Report Foreign Assets or Income

If you have foreign bank accounts, investments, or income, failure to report them may attract severe penalties.

✅ How to Avoid:

• Report all foreign assets and income in Schedule FA of the ITR.
• Disclose any income earned outside India, including dividends, capital gains, or interest.

9. Late Filing of ITR

Filing your return after the due date can lead to:

• Late filing fees up to ₹5,000 under Section 234F.
• Loss of carry-forward benefits for losses.

✅ How to Avoid:

• File your ITR before the due date (usually 31st July for individuals and 31st October for businesses).

10. Not Paying Self-Assessment Tax

If your tax liability exceeds TDS deductions, you must pay the balance tax before filing ITR.

✅ How to Avoid:

• Use Challan 280 on the Income Tax Portal to pay outstanding taxes.
• If tax liability is more than ₹10,000, pay advance tax quarterly to avoid interest under Section 234B and 234C.

How ASK ASSOCIATES Helps You Avoid These Mistakes

At ASK ASSOCIATES, we provide end-to-end assistance in filing your income tax return accurately, ensuring:

✅ Selection of the correct ITR form
✅ Error-free filing and reconciliation with Form 16 and 26AS
✅ Maximum deduction claims to reduce tax liability
✅ Prompt verification and submission to avoid penalties
✅ Assistance in case of tax notices or refund delays

Filing ITR correctly is not just about compliance—it’s about maximizing your tax benefits. Avoid mistakes and ensure a smooth tax filing process with ASK ASSOCIATES!