Income Tax Notice: What to do if you receive a Section 143 (1) notice from taxman?

The thought of getting a Section 143 (1) income tax notice for wrong information provided in the income tax return (ITR) may make you worried. While it is a document that shows that the Income Tax (I-T) Department might have caught you on the wrong foot, you don't need to panic about it. You just need to know the right procedure to deal with it. Know what you need to tell the taxman if you have received an income tax notice.

In the technical language of the taxman, the income tax notice is known as Letter of Information. The notice tells if tax information you have mentioned in your ITR is right or wrong. Photo: Unsplash/Representational

Income Tax Notice: When you are filing your income tax return (ITR), the first thing you want is tax rebate from the Income Tax (I-T) Department and the last thing you want from it is a Section 143 (1) Income Tax Notice. Though the current I-T Department website is quite user-friendly and shows calculations of the taxes you have to pay, it is quite a possibility that you would have fed the wrong information mistakenly in your ITR.

You didn't realise your mistake then; you submitted it and ended up receiving Section 143 (1) Income Tax Notice.

While wrong information in ITR invites penalty from the taxman, receiving a notice doesn't mean that you will surely be penalised.

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You can reply to that notice constructively.

In this write-up, we will tell you how to deal with Section 143 (1) Income Tax Notice, which is also known as Letter of Intimation in ITR.

ITR Notice: What is Letter of Intimation in ITR?

In the technical language of taxman, the income tax notice is known as Letter of Information.

The notice tells if tax information you have mentioned in your ITR is right or wrong.

The notice asks the taxpayer to make corrections in their ITR.

ITR Notice: Reasons for receiving Income Tax notice?

Whether your liability is more than the tax paid during the income tax return.

Whether your liability is less than the tax you have paid during the return.

One may receive such income tax notices till the time their returns has not been processed.

ITR Notice: How to deal with income tax notice?

Do not delay you response

If you receive such a notice from the I-T department, don't delay and reply it as soon as possible.

The tax notice under Section 143(1) is called 'Notice of Demand'.

It means, if you have any outstanding tax liability, you should pay it within 20 days of receiving the notice.

If you delay your response and 30 days have passed, you will have to pay monthly interest at the rate of one per cent.

ITR Notice: What you can do?

If you go to the website of the Income Tax Department, you will find ITR Status written at No. 9 option in the left column on the homepage.
If you click on it, a new page will open where you will have to fill PAN number, ITR acknowledgment number and captcha code. After submitting the ITR, the I-T Department sends the acknowledgment number to your registered mail ID.
After submitting all these details, the status of ITR processing will be known. If the return has not been processed, the screen will show 'Return Submitted and Verified'. If it has been processed, the screen will show Return Processed and Refund Paid.
If you log in to the Income Tax website, you will find Filing of Income Tax Return and View Returns/Forms on the dashboard below.
If you click on the second option, a new page will open in which your PAN number will be uploaded and below the assessment year and income tax return will have to be selected.
After submitting, the return status will be displayed. If the return has not been processed, the status will show as Successfully verified.
If ITR Processed is written, then understand that your ITR has been processed.

ITR Notice: Demand Notice (under Section 156)

An income tax notice under Section 156 is issued against the outstanding dues, interest, penalty, etc.

Such notices are generally sent after post assessment of the income tax return.

The assessment officer issues this notice; gives instructions for the due amount; and asks the taxpayer to deposit the outstanding amount on time to avoid any penalty.

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