File Your ITR for 2024 Accurately: Avoid These 12 Common Mistakes
File Your ITR for 2024 Accurately: Avoid These 12 Common Mistakes
Filing your Income Tax Return (ITR) can seem daunting, but it doesn’t have to be. By familiarizing yourself with some common mistakes and taking a few precautions, you can ensure a smooth filing process and avoid potential tax penalties.
This article dives into 12 pitfalls to steer clear of while filing your ITR for the 2024 assessment year.
Common Mistakes to Avoid
1. Neglecting Capital Gains on Mutual Fund Switches: Don’t forget to report capital gains generated from switching between mutual fund units, even if the money doesn’t directly enter your bank account.
2. Unlinked PAN and Bank Account: Ensure your PAN card is linked to your bank account for seamless refund processing. Verify your bank details on the income tax website to avoid delays.
3. Residential Status Confusion: Understanding your residential status for tax purposes is crucial. Residents pay tax on worldwide income, while non-residents only pay taxes on income earned in India. Classify yourself correctly to avoid overpaying or underpaying taxes.
4. Missing e-Verification: Don’t forget to e-verify your ITR online after filing. This is a mandatory step to validate your return within 30 days. You can use Aadhaar OTP, EVC, or other methods for e-verification.
5. Unreconciled Form 26AS: This form reflects the Tax Deducted at Source (TDS) deposited on your behalf. Ensure all income mentioned in Form 26AS is also reported in your ITR.
6. Incorrect Bank Details: Double-check the bank account number and IFSC code entered in your ITR. The Income Tax Department transfers refunds directly to this account.
7. Wrong ITR Form Selection: Different ITR forms exist for various taxpayer categories. Choosing the wrong form can lead to delays or even invalidation of your return.
8. Ignoring Investment Losses: Report losses from investments like stocks, mutual funds, or F&O to offset them against capital gains. You can carry forward unadjusted losses for up to eight financial years.
9. Foreign Income and Asset Exclusion: Disclose all foreign assets and income in your tax return. This includes shares in overseas companies, foreign bank accounts, and income from foreign sources.
10. Missing ‘Other Income’: Report income from interest, dividends, and capital gains on stocks and mutual funds. The Annual Information Statement (AIS) reflects this information, and the tax department will be aware of it.
11. Overlooking Exemptions: Don’t miss out on claiming exemptions for savings bank interest under Section 80TTA (up to Rs. 10,000) and for senior citizens under Section 80TTB (up to Rs. 50,000).
12. Forgetting Deductible Expenses: Claim tax deductions for preventive health checkups (up to Rs. 5,000 under Section 80D), medical expenses of senior citizens, and certain illnesses and disabilities.
Conclusion
By staying informed about these common mistakes and keeping good records, you can file your ITR for 2024 with confidence. If you have any complex tax filing needs, consider consulting a qualified tax professional for guidance. Remember, a timely and accurate ITR filing ensures a smoother tax process and avoids potential refund delays and penalties.