After filing an Income Tax Return, people often receive notices from the Income Tax Department. Many people become alarmed by this notice, although not every notice indicates a penalty or a problem. The Income Tax Department can send notices for a variety of reasons.
An income tax notice is an official letter or message sent by the Income Tax Department. Its main purpose is to verify your income, returns, and deductions. You may also receive a notice if you provide incorrect information while filing your ITR.
In this article, we’ll learn what an Income Tax Notice is, how many types there are, and how to respond to them. We’ll answer all these questions in detail.
What is Income Tax Notice?
An income tax notice is sent to a taxpayer by the income tax department. This notice can be received by email, post, or on the income tax portal website. The notice requires verification of information related to the taxpayer’s income, tax return, or financial transaction.
If you haven’t filed your Income Tax Return (ITR) or have entered incorrect information, the department may ask for an explanation. The notice will also include the reasoning, making it easier to take action.
When does the income tax notice come?
If you’ve received a notice from the Income Tax Department, there’s no need to panic. Income tax notices can arise for a variety of reasons, including:
- Not filing an ITR
- Providing incorrect income information
- Making a large bank transaction
- Buying or selling a high-value property
- Mismatch in TDS and ITR
- Suspicious financial transaction
- Claiming an extra deduction.
Types of Income Tax Notice
The Income Tax Department sends different types of notices. Each one is responded to in a different way. The different types of notices are listed below.
Defective Return Notice – Section 139(9)
You receive this notice when your filed ITR contains errors or incomplete information. If you update the correct information on time, your return becomes valid.
Inquiry Notice – Section 142(1)
As the name suggests, this is when the Income Tax Department asks you for additional information. This notice may ask you to submit documents, bank statements, or proof of income.
Intimation Notice – Section 143(1)
This is a common notice sent by the Income Tax Department after your ITR is processed. It verifies your filed return and informs you whether your tax calculations are correct.
Scrutiny Notice – Section 143(2)
When the department wants to examine your return in detail, it issues a notice asking for additional documents and explanations. It’s crucial to respond to this notice.
Income Escaped Assessment Notice – Section 148
This notice is received when an income tax returner conceals their income. In this situation, the Income Tax Department asks you to re-file your return and provide income details. It’s important to respond; failing to do so could result in problems.
How to respond to Income Tax Notice?
If you receive an income tax notice, it’s important to understand it first. The notice lists the section number, reason, and deadline, which will help you respond.
Therefore, first read the notice carefully, after which collect the required documents like bank statement, salary slip, form 16, investment proof etc.
After gathering all the information, log in to the Imcome Tax Portal and reply to the Notices section. You can also upload the required documents.
Cocnlusion
If you’re having trouble responding to a notice or are unsure about it, seek the help of a professional CA. Ignoring an income tax notice could result in a penalty.
My name is Neha Arya and I’m the founder of Latestsarkariyojana. On this blog, I share information about government schemes, online forms, important documents, government jobs, and digital services. My goal is to raise awareness and help people access the benefits of government schemes.