Income Tax: Make note of these seven points before you file your return

As fewer than three weeks are left before the deadline to file the income tax return ends — taxpayers are advised to be careful about certain things so that a flawless return is submitted to the income tax department.

With the deadline of July 31 looming closer, taxpayers are expected to be careful about an array of things before pressing the ‘submit’.

Seven points to remember:

1. At the outset, there could be some discrepancy between form 16 and form 26AS. So, taxpayers should clear the anomalies, if any between the two documents. Such discrepancies may occur on account of a number of reasons such as filing errors, incorrect or delayed reporting by the employer(s), or dealing with multiple deductions.

This should be rectified before filing the return, else it may lead to a notice from the income tax department.

2. If you paid a medical insurance premium during the year, do not forget to claim the deduction under section 80C even if the amount was small. There is no point paying extra tax than you are liable for.

3. In case you have made an investment more than the maximum threshold of exemption under section 80C i.e., ₹1.5 lakh, then you can apply for the maximum limit or investment made, whichever is lower.

4. If you have invested into cryptocurrencies then it is vital to show the capital gains income and pay tax on it. This is one of the additions in the income tax form this year, and the declaration needs to be made under Schedule VDA (virtual digital assets). Read this for details.

5. In case you received some prize money or lottery, you are supposed to pay a flat rate of 30 percent without any basic exemption limit. In such a case, the payer of prize money will deduct tax at source (TDS) and pay you the balance.

6. In case your income is taxed in India as well as abroad, then you can claim relief in respect of income charged in both the nations. Relief is either granted as per the provisions of double taxation avoidance agreement (DTAA) or by allowing relief as per section 91​ of the Act in respect of tax paid in the foreign country.

7. Not to mention that the deadline of filing income tax return (ITR) has, so far, not been extended, and one should not defer the filing of return with a premise that the deadline get extended.