Filing your Income Tax Return (ITR) correctly is important in order to stay in tax compliance and to prevent penalties. With the due date for ITR filing for FY 2024-25 (AY 2025-26) having been pushed to September 15, 2025, taxpayers are getting extra time to file error-free. But many of them still end up committing common pitfalls that can result in notices, penalties, or delays in processing. Recognizing these mistakes and taking preventive action can spare you unwanted trouble and enable hassle-free tax return processing. This complete guide addresses the most common ITR filing mistakes and offers functional solutions to avoid them.
Common Mistakes & How to Solve Them?
Let's dive into the most prevalent errors during income tax filing and how to effectively overcome them:
Choosing the Wrong ITR Form
The Problem: One of the most basic mistakes that taxpayers commit is choosing an incorrect ITR form. Every ITR form serves a particular income type and taxpayer segment.
The Solution: Before you begin, identify all your income sources for the financial year (April 1st to March 31st).
ITR-1 (Sahaj): For resident individuals with income from salary, pension, and house property not exceeding ?50 lakhs
ITR-2: For individuals and HUFs not engaged in business/profession with capital gain or foreign income
ITR-3: For individuals/HUFs with income from business or profession
ITR-4 (Sugam): For presumptive income from business and profession
Always check your income sources, residential status, and total income prior to form selection. Refer to the latest ITR form guide or a tax expert in case of doubt. For a deeper dive into understanding different income sources and their tax implications, consider enrolling in our comprehensive Accounting and Taxation Courses.
Not Reconciling with AIS and Form 26AS
The Problem: Dependent solely on your Form 16 (for salary) or failing to verify your Annual Information Statement (AIS) and Form 26AS before submitting. These reports present a unified perspective of your transactional finances and tax deductions/collections. Discrepancies may result in under-reporting the income or mismatched tax credits.
The Solution: Download AIS & Form 26AS: Log in to the e-filing portal and download these documents under the 'Services' tab.
Cross-Verify: Match each entry – salary, interest from fixed deposit/savings account, dividend, capital gains, TDS (Tax Deducted at Source), TCS (Tax Collected at Source), and advance tax paid.
Resolve Discrepancies: If you notice any discrepancy (e.g., invalid PAN, incorrect amount, nil entry), promptly communicate with the reporting entity (bank, employer, tenant) to rectify it. The AIS also provides a feedback system to report discrepancies directly to the Income Tax Department.
Incomplete/Incorrect Income Declaration
The Problem: Leaving out sources of income, underreporting the amount, or misclassifying income types may lead to questioning and penalties.
The Solution: Be careful.
Keep detailed records of all sources of income during the course of the year
Account for salary, business income, capital gains, house property income, and other sources
Report excluded income in the proper schedules
Be consistent in declared income and supporting documents
Double-check figures and prevent manual calculation errors
Incorrectly Claiming Deductions and Exemptions
The Problem: Since the new regime becomes the default for AY 2025-26, most taxpayers erroneously avail of deductions permissible only in the old regime.
The Solution:
Realize the distinction between old and new regimes
Select the one that yields maximum tax relief
Under the new regime, restricted deductions are permissible (standard deduction, employer contribution to NPS)
Under old regime, entire gamut of Section 80C, 80D, HRA, and other allowances
Ensure proper documentation for all deductions availed
Avoid double-claiming benefits or exceeding prescribed limits
Missing the Filing Deadline
The Problem: Failure to meet the filing deadline attracts 1% monthly penalties and interest on unpaid taxes.
The Solution: Note the date on the calendar and prepare to file way ahead. Late filing results in:
Mark key dates: September 15, 2025, for non-audit cases
File late returns by December 31, 2025, if missed deadline
Prepare ahead and set reminders
Secure documents way ahead
Seek professional assistance if the preparation is complex
Additional Information:
Late filing charges up to Rs. 5,000 may be applicable for late filing
Failure to E-Verify the Return
The Problem: Filing the return is just half the job. Without e-verification in 120 days, your return is no longer valid.
The Solution: E-verify your ITR within 30 days of filing. Options are
Do e-verification at the time of filing
Options available: Aadhaar OTP, net banking, bank account number, demat account, or EVC
Have login credentials ready for easy verification
Don't wait for physical verification (ITR-V) because of postal delay
Verify status on the e-filing portal
Ignoring Notices from the Income Tax Department
The Problem: Disregarding notice of taxes may create further issues, and mismatches may result in return rejection.
The Solution: Take every notice seriously.
Check your registered email address and e-filing account on a regular basis.
Reply to notices within time limits.
Submit the necessary documentation and clarifications.
Take professional assistance for intricate notice replies.
Keep records of communication with the tax department.
Resolve issues anticipatively instead of reactively. This proactive approach to compliance extends to all areas of taxation; for instance, understanding the GST Registration Process is another crucial step for many businesses.
How to Rectify Mistakes While Filing Income Tax Return?
Even if you've made a mistake, the Income Tax Act provides a window for correction through a Revised Return under Section 139(5).
Eligibility: You must have filed an original return.
Deadline: A revised return can generally be filed up to December 31st of the relevant assessment year, or before the completion of your assessment by the department, whichever is earlier.
Process:
Log in to the e-filing portal.
Go to 'e-File' > 'Income Tax Returns' > 'File Income Tax Return'.
Select the Assessment Year and the same ITR form as originally filed.
Choose "Revised Return" and enter the acknowledgment number and date of your original filing.
Make the necessary corrections to your income, deductions, or any other details.
Submit and e-verify the revised return.
Step-By-Step Guide To Avoid Mistakes While Filing ITR
To ensure accurate ITR filing and a hassle-free tax season:
Pre-Filing Preparation
Collect all income documents (Form 16, bank statements, investment proofs)
Download Form 26AS and AIS
Select the proper tax regime
Select the right ITR form
During Filing
Cross-check all entries with source documents
Reconcile TDS and advance tax paid
Claim eligible deductions, duly supported by documents
Check all sections before submitting
Post-Filing Actions
Complete e-verification within 120 days
Save the acknowledgment and ITR-V for record
Check the refund status if due
Reply promptly to notices
Continuous Monitoring
- Track notice communications
- Do correct documentation
- Plan to file next year from day one
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