It is advisable to file your ITR after all the TDS details have been accurately reported by the deductor and updated in Form 26AS
It is that time of the year when you have to file your Income Tax Return (ITR). But sometimes, filing can get delayed due to mismatches in the Annual Information Statement (AIS), Form 26AS, and Form 16. These mismatches can arise from data entry errors, incorrect reporting by the deductor, or delays in updating the information.
Another common mismatch is when the PAN or TAN details of the deductor in Form 16 or Form 26AS do not match with the AIS. Sometimes, certain TDS entries may be absent in both Form 26AS and the AIS. This situation can arise if the deductor has not reported the TDS details to the tax department or if there are delays in updating the information.
In such cases, it is crucial to contact the deductor and request accurate reporting of the TDS entries. Additionally, it is important to inform the income tax department about the mismatch and provide relevant evidence for their records.
But when is the right time to file ITR if the key income tax documents do not reconcile?
Aashish Sharma, Co- Founder & Litigation Head at Lex N Tax, explains in detail how to file an ITR if there is a mismatch in your Form 16, AIS and 26AS.
To ensure that your Form 16 and Form 26AS reconcile, it is advisable to file your ITR after all the TDS details have been accurately reported by the deductor and updated in Form 26AS. Here are some recommendations for the timing of filing your ITR:
Verify Form 26AS: Before filing your ITR, thoroughly review your Form 26AS to ensure that all TDS deductions made by your deductors are reflected correctly. Check if the TDS details, such as the deducted amount, deductor’s name, TAN, and PAN match with your records and Form 16. If there are any discrepancies, contact the deductor and the tax department to rectify the issues.
Wait for Final TDS Updates: It is advisable to wait till a reasonable period after the end of the financial year to allow all deductors to report the TDS details to the tax department. This gives them sufficient time to comply with their reporting obligations accurately. Waiting for the final updates minimises the chances of mismatches between Form 16 and Form 26AS.
Validate Form 16: Ensure that you have received the correct and duly signed Form 16 from all your deductors. Verify that the TDS details mentioned in Form 16 match with the details in Form 26AS. If you find any discrepancies, inform the deductor and request a revised Form 16 with accurate information.
Reconcile Other Income and Deductions: Apart from TDS, reconcile other income sources, deductions, and exemptions with your own records. Ensure that all sources of income are correctly accounted for and all eligible deductions and exemptions are considered in your ITR. This will help in reconciling the overall tax liability and avoiding discrepancies.
Timely Filing: Once you have ensured that the TDS details in Form 26AS and Form 16 reconcile and all other aspects of your income and deductions are in order, proceed with filing your ITR within the due dates specified by the tax department. Filing your ITR on time helps avoid penalties and compliance issues.
Remember, timely reconciliation of TDS details and accurate reporting in your ITR contribute to a smooth income tax filing process and minimize the chances of receiving notices or facing scrutiny from the tax department.
In all cases, maintaining proper documentation, such as copies of Form 16, communication with the deductor, and any supporting evidence, is essential. If the discrepancies persist or cannot be resolved with the deductor’s cooperation, consider filing a complaint or grievance with the income tax department through their online portal or by submitting a written complaint.
Source: https://www.businesstoday.in/personal-finance/tax/story/income-tax-return-when-to-file-itr-if-form-16-26as-ais-do-not-reconcile-386384-2023-06-20
© 2018 CA Chandan Agarwal. All rights reserved.