The Risks of Early Tax Filing: What You Need to Know

1. Incomplete Income Details in Form 26AS

Form 26AS available in June 2024 may not include complete income details for Q4 (January, February, March). As a result, taxpayers who filed their income tax returns (ITR) based solely on this form may face notices for income mismatches.

2. Challenges of Early Filing

Filing ITRs early has its advantages but also potential pitfalls, particularly if income data is incomplete or outdated.

3. Steps to Take if You Filed Early

• Check the I-T Portal: Verify if there are any outstanding queries or issues by logging into the income tax portal. Queries can delay refunds.
• Verify Form 26AS: Download the updated Form 26AS, Annual Information Statement (AIS), and Tax Information Statement (TIS). Check for discrepancies or new information.
• Verify the ITR Filed: Ensure that the income declared matches the updated Form 26AS. Check for completeness, especially for "income from other sources" which may have been pre-filled inaccurately.
• Calculate Applicable Taxes: Re-calculate taxes based on the updated information. Include interest under Sections 234B and 234C if necessary.
• File Revised I-T Returns: If needed, file a revised return under Section 139(5) by December 31, 2024.

4. Submission and Verification

After filing a revised return, submit it electronically and verify it within 30 days.

5. Overall Filing Statistics and Issues

By July 31, 2024, over 7.28 crore ITRs were filed, showing a 7.5% increase from the previous year. Both early and late filers faced challenges with incomplete tax data.

6. Responsibility of Accurate Filing

Early filing is commendable, but ensuring the accuracy of the information in Form 26AS, AIS, and TIS remains the taxpayer's responsibility, even if the ITR is pre-filled.