It is also important to mention your foreign investments.
It is always suggested not to hide any information regarding your income, deduction of tax or exemption claims while filing income tax returns.
July 31 is the last date to file income tax returns (ITR) for the financial year 2022-23 to avoid penalties. Almost 4 crore taxpayers have already filled out their ITR forms. The Income Tax department said that last year around 5.80 crore taxpayers filed their ITR. And this year, almost around 2 crore taxpayers are yet to file their ITR.
While filling out the forms, the taxpayers are required to provide accurate information about their sources of income and tax savings investments. At certain times, taxpayers fill out the form in a hurry and make some common errors that can lead to financial issues and legal consequences. Let us take a look at some of the most common mistakes you should avoid while filing ITR this year:
Avoid hiding information
It is always suggested not to hide any information regarding your income, deduction of tax, or exemption claims. It is also important for you to be careful about the financial year and not the assessment year. If you have two savings accounts, it is important to mention the interest received from both savings accounts. If you miss to include this, you might receive a notice from the Income Tax Department.
Foreign Investments
It is important to mention the foreign investments including shares, debentures, life insurance, income from interest, capital gain or dividends. It is imperative to mention every detail, otherwise, you might receive a notice from the department. If there are immovable properties abroad like houses or any other capital asset, they should also be mentioned.
PPF account
The amount received from a Public Provident Fund (PPF) account or interest is also required to be mentioned while filling out ITR forms. There is a separate section in the form for mentioning exempted incomes like PPF.
Not clubbing incomes
You are required to club the income of your child (if any) or your spouse with your income. If your child is above 18 years and has an income source that must be included in the form, even if you are receiving an interest from an account after your child’s name (for instance, an FD account) then it also needs to be filled in the ITR form.
Mention your investments
Though most of the income received from the investments is tax-free still it is needed to be mentioned in the ITR form. If you put all the interest received from the investments then you might get a tax exemption.