Heaving a sigh of relief after the ITR filing deadline of December 31? But your job is not done yet! Here are 4 things to run a check on, before you call it a day.
#1 Verify your returns, if not done yet
Successful filing of your ITRs in the just concluded season is sure an incredible feat, after having navigated all the glitches and the heavy server load on December 31, 2021.
But you cannot yet cross out return filing from your to-do list, unless you have verified your returns. This is because the returns are considered invalid without verification, which needs to be done within 120 days of filing. Verification can be done by mailing a duly signed copy of your Acknowledgement form or Form V (downloaded from the Income tax website), to the Income Tax Department’s office in Bengaluru.
It should be noted that the copy of the form should be mailed only through ordinary post or speed post and not by courier.
Alternatively, taxpayers can also e-verify their returns using either one’s Net banking account/Aadhaar-based OTP/bank or demat account number. Upon selecting the desired option, users will be sent an electronic verification code or One Time Password, to their registered mobile number, bank account or demat account. This code or OTP needs to be keyed in on the income tax portal, to complete the process of e-verification of your ITRs.
One can even generate the electronic code for verification of returns using ATMs of select banks (such as SBI, Axis Bank and ICICI Bank) where you are an account holder and have registered your PAN with the bank.
Taxpayers whose books of accounts are required to be audited under section 44AB of the Income Tax Act should mandatorily verify their returns using their Digital Signature Certificate, immediately after filing the return.
So what happens if you don’t verify within 120 days of filing the ITR? You will be first required to submit a condonation of delay (in the form of a service request) on the portal, by providing an appropriate reason. Only after the approval of the condonation request by the Income Tax Department will you be allowed to verify your returns. Else, it will be deemed as though you haven’t filed your return and this may attract all consequences of not filing your ITRs on time. For instance, a late filing fee may be applicable, along with the interest on your tax liability.
#2 Made a mistake? Revise your return
In the scramble to file your returns before the deadline, if you have missed mentioning something (incomes or deductions) in the ITRs, fret not. The taxman allows you to revise your return, if the same hasn’t been processed by the department yet.
There is no specific return form or no separate procedure to file revised returns. One just has to choose the option of ‘revised return’ in the department’s e-filing portal and the procedure is pretty much the same as filing the original one. This time, while entering in the correct details, you will also be required to mention the e-filing acknowledgement number and the date of filing of the original return.
Normally this revised return should be filed within three months prior to the end of the relevant assessment year (that is December 31 of that AY) or before the completion of the assessment, whichever is earlier. But in the case of AY 2021-22, the deadline for filing revised returns has been extended to March 31, 2022, as the return filing deadline itself was moved to December 31, 2021. However, the point to note here is that if the IT department finishes the assessment (that is, if your originally filed returns are processed and an intimation under section 143(1) is received) before this deadline for filing revised returns, you will not be able to revise from then on. For example, many who filed their returns even in the last week of December have already begun receiving the 143(1) intimation. Thus, the window for revising the return, in practice, can be quite short for many.
Do note that the deadline for filing belated returns for any AY is the same as for filing a revised one. Hence, a logical conclusion is that if you file your belated returns itself with only a few days to spare, you may not have enough time to revise it.
Within the stipulated timeframe, there is no ceiling on the number of times a return can be revised. All earlier versions will be scrapped and the latest one will be considered for processing. However, by doing multiple revisions you may catch the attention of officials, who may take it up for detailed scrutiny, especially when there are big changes.
That apart, one must also remember to verify the revised returns as well, using any of the above-mentioned methods.
#3 More taxes demanded? Rectification is a way out
What if you noticed the error only after the returns were processed by the department, or had forgotten about something completely when filing the return? Most likely, the 143(1) intimation could point out a mismatch, juxtaposing your tax calculations with that of the department’s and demand more taxes if needed.
If you agree with the calculations made by the department, you can go ahead and pay the tax demanded. But there can be circumstances where you erroneously missed entering a few details such as an expense that could be claimed as a deduction, that could have led to the excess demand by the department. Or the assessing officer himself could have made an apparent error – an evident miscalculation or any other kind of an omission.
In all such cases where returns are already processed, users can file rectification requests, within 4 years from the end of the financial year in which the order sought to be amended was passed. Here, you can cite either your disagreement with the department’s calculations or mistakes committed by you while filing the original return. The tax authorities should respond to your requests within six months from the end of the month in which the rectification application is received.
Users can raise four types of rectification requests. One, if all details were duly furnished by the taxpayer but the department has missed considering some information, the user can opt for ‘reprocess the return’, with no additional details being filed. Two, if details in TDS/ TCS or IT challans have to be rectified, taxpayers can opt for a ‘tax credit mismatch correction’ request, wherein users can manually enter the omitted entries of TDS/TCS/Advance tax/ Self -assessment tax. Three, if particulars regarding interest calculations under section 234C have to be rectified, users can opt for the request of ‘additional information for 234C interest’. Four, to correct other details in the original returns, users can opt for ‘return data correction’ (Offline/ Online) and select the appropriate schedules to be changed, by citing maximum of four reasons for such changes.
However, one must note that under the new e-filing portal, users can currently only submit rectification requests for ‘reprocessing of returns’ for AY 2021-22. The other rectification request types will be made available soon on the portal.
In the recent tax filing season, with the numerous glitches in the new e-filing portal, a few taxpayers, for instance, couldn’t take full credit of the tax available in their Form 26 AS, due to a glitch in the auto-filled fields in the new portal. Such users who manually altered the taxes paid fields (based on their Form 26 AS) received an intimation order under section 143(1), reflecting a lower refund than what was due to them. And the reason cited was ‘Form 26AS does not contain/contains partial amount of TDS with respect to the TAN mentioned in the schedule TDS 1/ TDS2/ TCS’. Whereas the form 26 AS downloaded from ‘Traces’ website reflects the entire amount and the return processing software has erroneously only considered a part of it.
The only recourse now available for such taxpayers is to file a rectification request on the portal.
#4 Track refunds, if any
If no mistakes were made by you, the e-filing portal was glitch-free, and the processing was smoothly done, you have no reasons to fret. However, if you have paid excess taxes and are awaiting a refund, you can check the status of the same on the dashboard of the new income tax portal. Taxpayers can also check the same on the NSDL portal (https://tin.tin.nsdl.com/oltas/servlet/RefundStatusTrack), by furnishing the details of one’s PAN.
Besides, following the faceless processing of returns, refunds should be credited to your bank accounts within 15 days of date of receipt of intimation. However, at times, delays happen due to various reasons. If refunds are pending due to insufficient or incorrect details of bank account (account number or IFSC code) being furnished by you, you can rectify the same using service requests option on the new income tax portal.
Do note that taxpayers are also entitled to interest on such tax refunds, at the rate of 0.5 per cent for a month or a part of month. If your refund amount pertains to any excess tax paid by way of tax deducted at or collected at source or advance tax, then interest shall be paid from April 1 of the relevant assessment year to the date of grant of refund. Taxpayers who filed their ITRs after the due date will be entitled to interest on refunds only from the date of furnishing their returns.
If the refund pertains to self-assessment tax, the interest shall be paid from date of payment of such tax or date of filing of ITR, whichever is later.
While calculating such interest on refunds, periods of delays due to actions of the taxpayer, such as those pertaining to insufficient details being furnished by the taxpayer, etc. will be excluded.
Besides, do remember to add such interest earned on your refunds, in your taxable income next year!