Delaying filing of Income Tax Returns until the tax deadline enables individuals to evaluate their financial situation more effectively
Early Filing Statistics
By April 29, a significant number of taxpayers had already filed their ITRs for FY 2023-24, with over 5.92 lakh returns submitted. Of these, more than 5.38 lakh were verified, and approximately 3.67 lakh were processed early. Early filing allows for revisions without penalties, but it also comes with certain risks and challenges.
Key Considerations for Timely and Accurate Filing
Sweet Spot Timing
Taxpayers are advised to wait until mid-June to file their returns, especially those with incomes like salary, interest, and rent affected by Tax Deducted at Source (TDS). This timing ensures that reconciliation with TDS data reported on their PAN is accurate.
Importance of Form 26AS and AIS TDS
Waiting for Form 26AS and AIS TDS, reflecting TDS data reported by payers with the payee’s PAN by May 31, is crucial for claiming TDS accurately in ITR. Filing before this data is updated can lead to complications and potential disallowance of TDS claims.
SFT Reporting Deadline
Certain transactions mandated by income-tax laws must be reported to the I-T authorities in the Statement of Financial Transactions (SFT) by May 31, 2024, for FY24. Waiting to reconcile ITR data with SFT data on the I-T portal after the first week of June is advised.
Crucial Form 16
Employers must provide Form 16 detailing salary and TDS to employees by June 15. Taxpayers should wait for Form 16 before filing ITR to ensure accurate reporting and avoid potential complications.
Consideration for NRIs
Non-Resident Indians (NRIs) are advised to wait until the second week of June to file their returns, aligning their information with that on the I-T portal for accuracy.
Who Should Consider Early Filing in May
Salaried individuals with straightforward tax affairs and expecting tax refunds may consider filing early in May. Taxpayers traveling or relocating close to the filing deadline can benefit from early filing to avoid last-minute hassles.
Importance of AIS for Tax Filing
The Annual Information Statement (AIS) plays a critical role in tax filing, providing a detailed summary of a taxpayer’s information, including TDS, interest, dividends, stock market transactions, and more. It ensures accurate reporting and helps in automatic filling of relevant tax return sections.
