Haven’t received Income Tax Return yet? You may have to confirm it

Finance

Your income tax refund may be held up pending your confirmation about its accuracy if there was a significant difference in incomes or deductions that you claimed while filing your ITR compared to your Form 16 or 16A. In this case, for refund to be credited into your bank account you may have to respond to the email sent by IT department, asking you to confirm your refund claim.

Kapil Rana, Founder & Chairman, HostBooks, a tax compliance solution provider says “While processing ITR with a refund claim, for the first time the department is asking individual taxpayers for confirmation on correctness of differences in income appearing in Form 16 or Form 16A or Form 26AS and also difference in deduction / exemption as appearing in Form 16 and as claimed by the assessee while filing ITR.”

This is largely happening in the cases where the difference on account of deductions and exemptions shown in the Form 16 and the ones claimed in final ITR is big. Abhishek Soni, CEO and co-founder, Tax2Win.in, an ITR filing company says, “Practically, this year we have observed that the Income Tax Department is sending one email to the taxpayers where there are huge deviations in the income tax return filed as compared to the form 16. In such cases, the Income Tax Department is sending the mail to confirm the amount of refund.”

The text of the email received by some taxpayers is somewhat as below:

Dear Taxpayer,
It is seen that a claim of refund has been made in the Income Tax Return xxxxxxxxxx for 2020 filed by you on xx-SEP-20.
Your Income Tax Return has been selected under risk management process wherein your confirmation is required on the claim of refund. You are requested to submit your response in the e-Filing Portal post login by selecting either of the following options:

  • The claim of refund is correct to the best of my knowledge and belief
  • Return of Income is being revised wherein, correct claim of refund shall be made

To submit the response, please login to e-Filing portal, Go to Worklist->For Your Action-> Response for Refund Confirmation.
Please verify the claims made in your Return of Income filed and submit your response accordingly. In case of any incorrect claims, please revise your Income Tax Return (ITR).
Please submit your response within 30 days of receipt of this e-mail. Please ignore this mail, if you have already submitted your response.
Regards,
Compliance Management Team
Income Tax Department

Such differences not unusual for many taxpayers

Differences in income/deductions as mentioned above is not unusual for many taxpayers due to various reasons.
“Deadline for submitting investment proofs (to claim tax breaks under sections 80C, 80D etc) set by the employer may be Jan 31. However, tax saving investment may have been made after that but before 31st March or uncertain income (like capital gain) could have been earned up to 31st March. It can also be possible that rent payment evidence has not been given to the employer within the above deadline (Jan 31) for claiming HRA exemption” says Rana of Hostbooks.

On many occasions the Form 16 issued by the employer may not contain all deductions that are available to taxpayers under the existing law. If the taxpayer claims these deductions while filing ITR, then these are bound to differ from the ones mentioned in Form 16.

What should you do?

If there was such a difference in your ITR and you haven’t received your return, the first thing you need to do is to check your email for any intimation from the IT department regarding the refund. You can also login to your account on the income tax department’s e-filing portal to check the same. Once you login to your account on the portal you will have to submit your response by choosing one of the following two options.

  • The claim of refund is correct to the best of my knowledge and belief
  • Return of Income is being revised wherein, correct claim of refund shall be made.

If the refund claim made by you is correct, then you will have to select the first option. However, if there is an error you will have to file a revised ITR. “The taxpayer should check for the issues highlighted in the intimation and submit a response through his income-tax e-filing account by visiting e-proceedings tab or submitting a revised ITR. Once a response is submitted by the taxpayer, his/her ITR is taken up for processing again” says Naveen Wadhwa, DGM at Taxmann.

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