Tax notices post-filed income tax returns on the rise due to mismatched data and errors

Even after timely filing, taxpayers may receive notices from the Income Tax Department owing to discrepancies in declared income, TDS mismatches, or incomplete submissions. Experts advise careful review and prompt response to resolve issues effectively.

Filing an income tax return on time does not always end a taxpayer’s dealings with the revenue authorities. Even after a return has been submitted before the deadline, the Income Tax Department can still issue a notice if the figures in the return do not line up with the information it already holds from employers, banks and other reporting channels. NDTV Profit says that three of the most common triggers are mismatched income, differences in tax credit data and mistakes in deductions, exemptions or return forms.

One frequent problem is a gap between the income declared in the return and the figures reported elsewhere, such as Form 16 issued by an employer or the Annual Information Statement. LiveMint has also reported that salary mismatches, unreported income and incomplete disclosures are among the main reasons taxpayers later hear from the department. A second issue is a mismatch in tax deducted at source, or TDS, and tax collected at source, or TCS, where the credit claimed in the return does not match Form 26AS or the department’s records, often because a deductor has not filed or corrected its return in time.

A third risk arises when a taxpayer uses the wrong return form, leaves out required details or claims deductions and exemptions that are not backed by documents. Angel One and TaxBuddy both note that defective or incomplete returns can draw scrutiny, as can larger discrepancies linked to high-value transactions or other information available to the tax office. LiveMint has further listed notices such as intimations under Section 143(1), defective return notices under Section 139(9), scrutiny notices under Section 143(2) and demand notices under Section 156 as some of the forms taxpayers may encounter after filing.

If a notice arrives, the first step is to check that it is genuine by logging on to the official income-tax e-filing portal and matching it with the document identification number and PAN. Taxpayers should then read the notice carefully, compare it with Form 16, Form 26AS and other supporting records, and respond within the time allowed. In some cases, such as a defective return, the correct remedy may be to file a revised return rather than simply sending an explanation.