Details

As the income tax filing season approaches, it becomes important for taxpayers to stay updated with the latest changes introduced by the Income Tax Department. At MADHU KUMAR & CO., we assist individuals and businesses in navigating these updates to ensure accurate and timely compliance. The Income Tax Return (ITR) process has evolved significantly in recent years, with increased digitization, changes in reporting requirements, and stricter enforcement protocols.

Key Changes in the Latest Filing Guidelines:

• Prefilled ITR Forms
  The Income Tax Department now provides prefilled data for salaried individuals and certain classes of taxpayers. This includes salary income, TDS, interest from savings accounts, and capital gains. Taxpayers are advised to cross-check and validate all prefilled information.

• Revised ITR Form Selection Criteria
  ITR forms have been restructured based on income sources and residential status. Taxpayers must ensure they are selecting the correct form to avoid defective returns or notices.

• Reporting of Foreign Assets and Income
  Individuals qualifying as residents under the Income Tax Act must report their foreign bank accounts, financial interests, and income earned outside India. Non-disclosure can lead to penalties under the Black Money Act.

• Additional Disclosures for Capital Gains and Other Sources
  Detailed reporting is now required for capital gains on listed shares, mutual funds, and property transactions. Similarly, income from dividends, winnings, and gifts must be disclosed separately.

• Linking PAN with Aadhaar
  It is mandatory to link PAN with Aadhaar before filing the return. Returns filed without this linkage may be considered invalid.

• Updated Tax Regime Selection Option
  Taxpayers have the option to choose between the old and new tax regimes. It is essential to evaluate which regime offers more tax savings before filing the return.

• TDS Credit Validation via AIS and Form 26AS
  Before filing the return, taxpayers should reconcile their TDS credits using both the Annual Information Statement (AIS) and Form 26AS. Mismatches can delay refund processing or result in tax notices.

Recommendations by MADHU KUMAR & CO.:

• Verify all sources of income including interest, dividends, and capital gains before filing.

• Preserve documentation for deductions and exemptions claimed, including rent receipts, medical bills, and donation proofs.

• Avoid last-minute filing to reduce errors and ensure timely processing of refunds.

• Consult a professional for accurate regime selection and to ensure full compliance with updated rules.