Income Tax Department Notice for Non Compliance & Non Filing of Returns

If you have not filed Income return for last few years ( ie Previous year 2012-2013, 2011-2012, 2010-2011, and 2009-2010) then chances are that you might have received income tax notice from income tax department.

Income Tax Department is collating information from various sources and is sending notice to non-filers of Income Tax return.

If you have received the income tax notice then there is no need to Panic. A notice doesn’t essentially mean you have got committed against the law and even a minor error in legal document will invite a notice from the tax department. You can reply on e-filing website and can submit the relevant information in Compliance section.

When you can get an IT Notice?

1). Income Tax notice for Income tax return not filed:

Generally if employer, has deducted TDS then, many employees assume that they do not have to file Income returns . Please note:- Every salaried employee have to file income tax return if its taxable income exceeds taxable limit as per income tax slab.

2). Mismatch in TDS deducted & TDS claimed:

Their maybe mismatch in Actual TDS as per your income tax return and TDS as reflected in 26AS .

In case, TDS deducted by employer is not reflecting, in your 26AS, it is better to contact your employer to rectify their TDS return .

3). Notice for High value transactions:

The high value transactions is closely scrutinized by tax department for the individuals. For e.g- in a year cash deposited Rs. 10 Lakh or more, or in a year purchase of debentures and bonds worth 5 Lakh or more, Rs 30 lakh or more purchase or sale property etc. To explain the source of income the taxman sends you a notice asking you to file a return .

4). Non disclosure of Income:

The Income Tax Department may send you a notice if you donot disclose the income for eg- Income from Shares, Bank Interest etc.

Some of the codes mentioned in Information summary of Income tax notice:

• CIB-403 – Time deposit exceeding Rs 2 lakh
• Cash deposit above Rs. 50000
• TDS return – Interest other than Section 194A
• Credit Card payment more than Rs 2 lakh
• CIB-321 Share transactions Rs 20000
• CIB-184, CIB-411
• TDS-92A, TDS-92B (TDS return salary to employee), TDS 94A
• TDS return – Insurance Commission
• CIB- 183 Time deposit of Rs 100000
• CIB-410 cash deposit aggregating of Rs 200000
• Transfer of Immovable property
• Interest in Bank exceeds Rs 50000

You will need to send your reply, depending on the information summery mentioned in notice.

How to reply to the Tax notice?

From Income Tax Department if you have received notice, do Not Panic. By the department furnish the information requested and simply respond to the notice.

If there is any shortfall in taxes then for that year it will be good to prepare a manual return and accordingly pay the taxes.

Take the help of a Tax expert if your case is complete. In extreme circumstances, peace of mind, money and cost you a lot of time could also lead to imprisonment in not responding to the notice.

Illustrated guide on “How to do so”.

Login to Income Tax Efilling

In the interface of Income Tax Department created a new module called as “Compliance”.

1). Login to the account of your Income Tax Department (Contact Clear Tax if you don’t have access to your Income Tax Department Account).

2) Choose the reason if you haven’t filled your return and go to the Income Tax Experts who will assist you with this matter.

or

In pick the type of filling, enter your acknowledgement number and Date of filling for the year of question if you have already filed your Income Tax Return and wait the IT Department next communication.

3). Submit the “Compliance Form” you may also be requested. This is a list of carried out associated with your PAN of all major financial transactions.

Look at the list items for the relevant year and mark the answers duly.

For example:

1. “CIB-403” or “Time Deposit exceeding Rs. 2,00,000/- with a Banking Company” may relate to your Fixed Deposits
2. “TDS-92B” or “TDS Return – Salary to employees (Section 192)” relates to income you have received as salary
3. “AIR-002” or “Paid Rs. 2,00,000 or more against Credit Card Bills” relates to your credit card spending
4. “TDS-94A” or “TDS Return – Interest other than interest on securities (Section 194A)” may relate to taxable interest income you may receive