As the income tax filing season comes to a close, the Income Tax Department has issued a stern warning to taxpayers against making false claims on their income tax returns (ITRs). With the deadline for filing ITRs for the assessment year 2024-25 set for July 31, the department emphasizes the importance of accurate filings to ensure timely refunds and avoid penalties.
Accurate Filings Crucial for Timely Refunds
The Income Tax Department and the Central Board of Direct Taxes (CBDT) have cautioned taxpayers against overstating deductions, understating income, or claiming non-genuine expenses on their returns. Such actions are considered offenses that can attract penalties and delay the processing of refunds. The department advises taxpayers to file their returns accurately to avoid any complications.
“Refund claims are subject to verification checks, which may cause delays. Accurate filing of ITR leads to quicker processing of refunds. Any discrepancies in the claims made will prompt a request for a revised return (to be filed by the taxpayer),” the department stated. Ensuring accurate information in the ITRs helps streamline the refund process, providing taxpayers with their due refunds in a timely manner.
Significant Number of ITRs Filed
By July 26, more than five crore ITRs had been submitted, showcasing the massive scale of tax compliance in the country. The filing deadline for the assessment year 2024-25 is July 31, applicable to all taxpayers whose accounts do not require auditing. The large volume of filings highlights the need for taxpayers to adhere to the guidelines provided by the department to avoid any potential issues.
New Tax Regime Gains Popularity
This year, a significant shift was observed in the tax filing preferences of taxpayers. According to CBDT Chairman Ravi Agrawal, over 66 percent of ITR filings were made under the new tax regime, which the government is promoting to simplify the direct tax system. The new regime offers lower tax rates but does not allow for various deductions and exemptions available under the old system.
Taxpayers have the option to choose between the old ITR filing system, which allows for deductions and exemptions, and the new regime, which offers lower tax rates. The choice of regime depends on the individual taxpayer’s financial situation and preferences.
Steps to Take if Refunds are Delayed
In cases where refunds are delayed, taxpayers are advised to check their e-filing account for any messages from the Income Tax Department. The department may request additional information or a revised return if discrepancies are found. Taxpayers should respond promptly through the “pending action and worklist section” tab to resolve any issues and expedite the refund process.
Extension of Withholding Period for Refunds
The recent Budget proposal to extend the withholding of refunds from 30 to 60 days from the date of assessment or reassessment has raised concerns among taxpayers. However, CBDT Chairman Agrawal assured that such cases would be minimal. This provision applies when there is an existing demand or a likely demand against the same assessee. Once the assessment is completed, the assessee has 30 days to pay the demand, and the refund can be adjusted during this period.
Conclusion
As the deadline for ITR filing approaches, the Income Tax Department’s warning serves as a crucial reminder for taxpayers to ensure the accuracy of their returns. By doing so, they can avoid penalties, expedite the refund process, and contribute to a smoother tax compliance experience.
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