I-T DEPT WARNING TO SALARIED TAXPAYERS:-Heavy Penalty if you do not file your tax return on or before 31st July 2018

I-T DEPT WARNING TO SALARIED TAXPAYERS:

8 common inaccuracies every taxpayer should take care of NOW....

1.          Non reporting of interest income from savings/ fixed deposits account:

These amounts can be directly mapped form the individual’s bank account statements and Form 26AS. “Non-reporting / under reporting of these amounts are apparent cases of tax evasion and calls for further investigation. Further, at times taxes are also deducted on interest income and hence, the mismatch of income by non-reporting are easily identified.

2.          Fake bills submitted for HRA claims:

One of the common fraudulent practice by employees are to claim fake HRA bills without adequate supportings, like lease agreement, etc. Further there are no adequate outflows from their bank account to the extent of rent payments claimed. Such obvious frauds would now call for punishment under the provisions of the Income-Tax Act based on the recent advice.

3.          Claiming false 80C deductions:

It is very easy for employees to claim false 80C deductions like LIC bills, Mediclaim deductions etc. inflating the value of eligible fixed deposits without actual outflow of such investments.

4.          Not considering income derived from all employers:

People changing the job should ensure that they consider the income derived from all the employers while filing their tax return. The Tax Department already have this information based on TDS return filed by the employer and missing to report any such income can trigger inquiry against them.

5.          Claiming false deduction under chapter VI-A:

 There are a few tax professionals who try to lure the taxpayers by promising high refund and charge them 10-25% of their refund amount. These professionals indulge in inflating or making wrong claims under various sections of Chapter VI-A like,

• ·      Tax Saving Investment u/s 80C,
• ·       Education loan interest - u/s 80E,
• ·      Deduction form Mediclaim policies - u/s 80D,
• ·      Rajiv Gandhi Equity Saving Scheme - u/s 80CCG,
• ·      Donations - u/s 80G, 80GGA, 80GGC or other deductions relating to disability or medical treatment of certain illness - u/s 80DD, 80DDB, 80U.

With linkage of Aadhaar and PAN to all your bank account, loan account, demat account, and insurance policies, the I-T Department may be able to digitally verify many of your claims with the data available with them. In case of any discrepancy it can start investigation against the tax payer.

6.          Making false claims under Section 10: 

Many salaried tax payers while filing their tax return indulge in making false claims under section 10, viz. HRA, LTA, medical reimbursement, etc. Since last year the Tax Department has started comparing the data in the tax return with the income as reported in Form 16, Form 16A, Form 26AS.

 7. Inflating claim of home loan interest.

Making false claims on capital gains:  In the past a few taxpayers in a bid to save tax on their capital gains made false claims u/s 54, 54F, 54EC, etc. New ITR Form requires to submit the details of the investment made under these sections.

 Further with the linkage of Aadhaar and PAN with property transactions and the financial account, it would be easy for the tax department to verify your claims electronically.

Heavy Penalty if you do not file your tax return on or before 31st July 2018

Last Date for Return File 31 st July.Aftet that Rs.5000/-penality.After 31st Dec 10000/-penality.

Source: Financial Express