scorecardresearchAre you a DIY income tax return filer? Don’t forget to mention income across

Are you a DIY income tax return filer? Don’t forget to mention income across these five sub categories

Updated: 13 Jun 2023, 12:49 PM IST

When filing your income tax return, it is important to provide accurate information about all income sources to avoid getting a notice from the income tax department.

It is important to provide complete information of types of incomes and assets in your tax return.

It is important to provide complete information of types of incomes and assets in your tax return.

While filing income tax return, taxpayers report their income and assets to the income tax department. But it is often seen that people do not give correct information about some of their income or earnings while filing income tax returns. As a result, they can – at times – get a notice from the income tax department.

You need to take care of these small things while filing your income tax return. If you keep this in mind from the beginning, then you can avoid coming under scrutiny by the income tax authorities. So let us tell you about some five types of income, about which it is necessary to give complete information while filling the ITR form.

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Total interest earned

Accrued interest is the income which is earned but not received. These are cumulative deposits or bonds in which interest is paid only on maturity. TDS can be charged on this income, therefore, it is important that this investment income is shown in the tax return. On leaving it, many questions can be asked from the tax department.

Details of interest earned on savings account

Generally, people do not give information about the interest earned on the amount deposited in their savings bank account while filing ITR. The reason for this is that the amount of interest is less and people think that it is not going to make any difference. In this way people cannot escape from such negligence. However, it is wrong not to show interest earned from savings accounts, even if the amount is small or zero. But it is necessary to show it in the ITR return.

Let us tell you that under section 80TTA, up to 10,000 will have to be claimed as a deduction annually. On leaving it, the information available with the income tax department will be considered wrong and you can get an income tax notice.

Section 142(1) of the Income Tax Act empowers the income tax authorities to issue a notice and seek clarifications or information in case the return is filed.

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Tax free income

There are many types of such tax free income, but these things have to be taken care of at the time of ITR file. Under any section of the Income Tax Act, some types of income are tax free and no tax has to be paid on it. These include interest on tax free bonds or some other receipts like interest on PPF (Public Provident Fund) etc.

But this does not mean that it should not be shown in the tax return as well. The details of such income have to be shown correctly in ITR. Generally, things like interest on PPF accounts keep on increasing every year and hence it has to be shown while filing ITR returns.

Earnings from investments made abroad

Many taxpayers also make foreign investments. This can be in the form of direct equity holdings or foreign funds or house property. Information about these investments has to be given while filing ITR returns. Along with this, the income from these holdings has to be shown. Ignoring or forgetting it can be a serious mistake, which may have consequences. That's why taxpayers should pay special attention to this.

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Income earned in the name of minor child

Parents also invest in the name of their minor child in whom the parent lives as a guardian. In this case, whatever interest is coming on the investment and bank account in the name of the minor, it will have to be added to the income of the parents.

Under this, the parent whose permanent account number is used with the investment or with the account will have to show it along with their income. There is a deduction of 1,500 on adding the income of the minor.

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First Published: 13 Jun 2023, 12:49 PM IST