Income Tax department warns against rising fake claims and fraudulent practices during ITR filing; key points to note
ITR: Fraudulent claims lead to delayed refunds, thorough investigations, additional tax liabilities, and penalties. The department encourages ethical filing to ensure smooth processing and avoid legal consequences.
The Income Tax Department has observed a rise in fake claims during ITR filing, cautioning taxpayers against exaggerated deductions and under-reporting income. Fraudulent claims lead to delayed refunds, thorough investigations, additional tax liabilities, and penalties. The department encourages ethical filing to ensure smooth processing and avoid legal consequences.
Income Tax Department's Recent Observation
Statement: The Income Tax Department has observed a rise in fake claims during ITR filing.
Advice: Taxpayers should avoid making exaggerated claims to prevent legal consequences.
Warning Against Fraudulent Claims
Punishable Offense: Filing false claims is a punishable offense.
Refund Delays: Fraudulent claims often lead to delays in ITR refunds due to investigation.
Warning Against Fraudulent Claims
Punishable Offense: Filing false claims is a punishable offense.
Refund Delays: Fraudulent claims often lead to delays in ITR refunds due to investigation.
Types of ITR Filing Frauds
Common Types: The department has identified three major types of frauds committed by taxpayers.
False Claims for Expenses
Issue: Many taxpayers are claiming deductions for expenses they haven't incurred.
Advice: The department urges taxpayers to refrain from making such false claims.
Exaggerating Deductions
Practice: Some taxpayers exaggerate their actual expenses to increase deductions.
Warning: The department has detected many such cases and has warned taxpayers against this practice.
Under-reporting Income
Method: Taxpayers often report less income to reduce their tax liability.
Consequences: This can lead to additional tax liability once the discrepancy is discovered during investigations.
Tax Rebate Misuse
Rebate Misuse: By under-reporting income, some taxpayers fall under the rebate category and avoid paying taxes.
Employed Individuals: Particularly common among employed individuals who do not report income from other sources.
Legal Consequences
Investigations: Fraudulent claims lead to thorough investigations by the department.
Liabilities: Discoveries of discrepancies result in additional tax liabilities and penalties.
Ethical Filing
Encouragement: The department encourages taxpayers to file their returns ethically and accurately.
Avoiding Fraud: Honest filing ensures smoother processing of refunds and avoids legal trouble.
Department's Vigilance
Monitoring: The Income Tax Department is actively monitoring and catching fraudulent claims.
Responsibility: Taxpayers are reminded of their responsibility to file accurate returns to avoid punitive actions.