Income Tax Notices - what should you do
Income Tax Notices - what should you do
Listed below are some of the sections of the Income Tax Act under which you can get a tax notice:
SECTION 139 (9)
You will get a notice under Section 139 (9) of the IT Act in case - you have used wrong ITR form; you haven't paid the entire tax due; you have claimed a refund for deducted tax but have not mentioned the relevant income; there is a mismatch in the name on the form and PAN card, or if you have paid taxes but not listed income.
Time limit to serve notice: NA
Time limit to respond: Within 15 days of date of intimation by assessing officer. You can write to the local assessing officer for an extension but if you don't respond, your return will be considered invalid.
What to do
Go to the income tax filing site https://incometaxindiaefiling or gov.in/e-Filing/ and download the right ITR form under the given assessment year. Then from the options listed, select 'In response to a notice under Section 139(9) where the original return filed was a defective return.'
Fill in the reference and acknowledgement number, and fill the form with rectifications. Under 'e-file', select 'e-file in response to notice u/s 139(9)' and upload it using the password in the notice.
SECTION 245
You will get this notice or intimation letter if you have claimed a refund in some assessment year, but there is also some outstanding tax to be paid by you. In such a case the AO can adjust the pending tax amount from the due refund.
Time limit to serve notice: NA
Time limit to respond: In the specified duration as per the notice by the assessing officer.
What to do
On receiving this intimation, you should first refer to the past records and verify if the demand is correct. Calculate the actual tax payable and paid. Open the income tax website and select the 'Response to Outstanding Tax Demand' option submit your response if you believe 'demand is correct' or 'demand is partially incorrect' or if you 'disagree with the demand'.
SECTION 143 (1)
The tax notice sent under Section 143 (1) is basically an intimation letter, which tells you whether you have paid the correct amount of tax, more than the required amount or less than the due sum. There can be three types of notices under this section:
1. Intimation: You are being informed that after the final assessment your return calculation matches the AO's computation.
2. Refund: The AO's calculation shows excessive tax paid by you.
3. Demand: The AO's calculation shows a shortfall in the tax paid by you and the notice will demand that the tax be paid within 30 days.
Time limit to serve notice: Before the expiry of one year from the end of financial year in which the return has been made.
Time limit to respond: If tax is due, you will have to pay it within 30 days.
What to do
If there is no discrepancy in the returns, you don't have to do anything. If a refund is due, it will be transferred to the bank account mentioned in the return. If it is not, request a reissue of the refund. If tax is due, you will have to pay it within 30 days.
SECTION 143 (1A)
Under this section, a computer-assisted notice is sent to the taxpayer if there is any discrepancy in the income mentioned in the return and Form 16, or deductions given under Section 80C or Chapter VIA and Form 26AS.
Time limit to serve notice: NA
Time limit to respond : 30 days from the date of issue of the communication.
What to do
You will have to log in to the tax filing portal and, under the 'e-Proceeding' section, explain the discrepancy along with the supporting documentary proof that will have to be uploaded
SECTION 143 (2)
This is a follow-up to the notice under Section 142 (1). The assessing officer is either not satisfied with your response or he has not received the documents sought. Your return will now be subject to detailed scrutiny.
Time limit to serve notice: Before the expiry of six months from the end of the financial year in which the return is filed.
Time limit to respond: The taxpayer will have to appear in person or through a representative before the officer on the date specified in the notice.
What to do
Get all the income and expense-related documents and other relevant papers, and do not miss the hearing.
SECTION 148
The notice under Section 148 is issued if the assessing officer thinks that some income might have escaped assessment. So you could be asked to file returns for the relevant assessment year or for reassessment.
Time limit to serve notice: If the income that has escaped assessment is Rs 1 lakh or less, it can be sent within four years of the end of the relevant assessment year. If it is more than Rs 1 lakh, the notice can be sent within six years.
Time limit to respond: The return will have to be furnished within 30 days or in the specified duration as per the notice by the assessing officer.
What to do
You will have to file the returns for the relevant assessment year, as directed by the assessing officer.
SECTION 234 (F)
This is a new section that has been introduced in the Income Tax Act, according to which a fee or penalty will be levied in case returns are not filed by July 31 of the relevant assessment year. Till date, a penalty of Rs 5,000 was levied at the discretion of the assessment officer if the return was not filed. Starting with assessment year 2018-19, a fee of Rs 5,000 will be charged in case returns are filed after the due date, but before December 31 of the relevant assessment year, or Rs 10,000 if it is filed after December 31 of the relevant assessment year. more
Listed below are some of the sections of the Income Tax Act under which you can get a tax notice:
SECTION 139 (9)
You will get a notice under Section 139 (9) of the IT Act in case - you have used wrong ITR form; you haven't paid the entire tax due; you have claimed a refund for deducted tax but have not mentioned the relevant income; there is a mismatch in the name on the form and PAN card, or if you have paid taxes but not listed income.
Time limit to serve notice: NA
Time limit to respond: Within 15 days of date of intimation by assessing officer. You can write to the local assessing officer for an extension but if you don't respond, your return will be considered invalid.
What to do
Go to the income tax filing site https://incometaxindiaefiling or gov.in/e-Filing/ and download the right ITR form under the given assessment year. Then from the options listed, select 'In response to a notice under Section 139(9) where the original return filed was a defective return.'
Fill in the reference and acknowledgement number, and fill the form with rectifications. Under 'e-file', select 'e-file in response to notice u/s 139(9)' and upload it using the password in the notice.
SECTION 245
You will get this notice or intimation letter if you have claimed a refund in some assessment year, but there is also some outstanding tax to be paid by you. In such a case the AO can adjust the pending tax amount from the due refund.
Time limit to serve notice: NA
Time limit to respond: In the specified duration as per the notice by the assessing officer.
What to do
On receiving this intimation, you should first refer to the past records and verify if the demand is correct. Calculate the actual tax payable and paid. Open the income tax website and select the 'Response to Outstanding Tax Demand' option submit your response if you believe 'demand is correct' or 'demand is partially incorrect' or if you 'disagree with the demand'.
SECTION 143 (1)
The tax notice sent under Section 143 (1) is basically an intimation letter, which tells you whether you have paid the correct amount of tax, more than the required amount or less than the due sum. There can be three types of notices under this section:
1. Intimation: You are being informed that after the final assessment your return calculation matches the AO's computation.
2. Refund: The AO's calculation shows excessive tax paid by you.
3. Demand: The AO's calculation shows a shortfall in the tax paid by you and the notice will demand that the tax be paid within 30 days.
Time limit to serve notice: Before the expiry of one year from the end of financial year in which the return has been made.
Time limit to respond: If tax is due, you will have to pay it within 30 days.
What to do
If there is no discrepancy in the returns, you don't have to do anything. If a refund is due, it will be transferred to the bank account mentioned in the return. If it is not, request a reissue of the refund. If tax is due, you will have to pay it within 30 days.
SECTION 143 (1A)
Under this section, a computer-assisted notice is sent to the taxpayer if there is any discrepancy in the income mentioned in the return and Form 16, or deductions given under Section 80C or Chapter VIA and Form 26AS.
Time limit to serve notice: NA
Time limit to respond : 30 days from the date of issue of the communication.
What to do
You will have to log in to the tax filing portal and, under the 'e-Proceeding' section, explain the discrepancy along with the supporting documentary proof that will have to be uploaded
SECTION 143 (2)
This is a follow-up to the notice under Section 142 (1). The assessing officer is either not satisfied with your response or he has not received the documents sought. Your return will now be subject to detailed scrutiny.
Time limit to serve notice: Before the expiry of six months from the end of the financial year in which the return is filed.
Time limit to respond: The taxpayer will have to appear in person or through a representative before the officer on the date specified in the notice.
What to do
Get all the income and expense-related documents and other relevant papers, and do not miss the hearing.
SECTION 148
The notice under Section 148 is issued if the assessing officer thinks that some income might have escaped assessment. So you could be asked to file returns for the relevant assessment year or for reassessment.
Time limit to serve notice: If the income that has escaped assessment is Rs 1 lakh or less, it can be sent within four years of the end of the relevant assessment year. If it is more than Rs 1 lakh, the notice can be sent within six years.
Time limit to respond: The return will have to be furnished within 30 days or in the specified duration as per the notice by the assessing officer.
What to do
You will have to file the returns for the relevant assessment year, as directed by the assessing officer.
SECTION 234 (F)
This is a new section that has been introduced in the Income Tax Act, according to which a fee or penalty will be levied in case returns are not filed by July 31 of the relevant assessment year. Till date, a penalty of Rs 5,000 was levied at the discretion of the assessment officer if the return was not filed. Starting with assessment year 2018-19, a fee of Rs 5,000 will be charged in case returns are filed after the due date, but before December 31 of the relevant assessment year, or Rs 10,000 if it is filed after December 31 of the relevant assessment year. more
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