AIS Mismatch: How to Correct It and Avoid Tax Notices

An AIS mismatch occurs when the financial data reported in your Income Tax Return (ITR) does not match the information available in the Annual Information Statement (AIS) maintained by the Income Tax Department. This can lead to discrepancies, delay refunds, and even trigger tax notices under various sections of the Income Tax Act. Identifying and correcting such mismatches before filing ensures accuracy, reduces compliance risk, and helps maintain a clean tax record.

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Table of Contents

• What is AIS and Why Do AIS Mismatches Occur?

• Common Reasons for AIS Mismatch in ITR Filing

• How to Correct AIS Mismatch Step-by-Step

• Impact of AIS Mismatch on Income Tax Notices

• Legal Remedies for AIS Mismatch After Filing ITR

• How to Prevent Future AIS Mismatches

• How TaxBuddy Helps with AIS Mismatch Correction

• Long-Tail Scenarios: AIS Mismatch and Bank Account Details

• Conclusion

• FAQs
  

What is AIS and Why Do AIS Mismatches Occur?

The Annual Information Statement (AIS) is a comprehensive record of a taxpayer’s financial transactions maintained by the Income Tax Department. It compiles data from various sources such as banks, employers, mutual funds, and other financial institutions linked to a person’s PAN. The AIS displays income details like salary, interest, dividends, securities transactions, TDS deductions, and other financial activities.

An AIS mismatch occurs when the information reflected in your AIS does not align with the income or deductions reported in your Income Tax Return (ITR). This discrepancy can happen due to incorrect reporting by financial institutions, duplication of transactions, TDS claimed under another PAN, or even timing differences between the reporting periods. Such inconsistencies can trigger tax notices or delays in return processing if not rectified before filing.

Common Reasons for AIS Mismatch in ITR Filing

Several factors contribute to an AIS mismatch during ITR filing. Common causes include:

• Incorrect or missing TDS entries by the deductor.
  

• Duplicate reporting of transactions by financial institutions.
  

• Inclusion of income belonging to a joint holder or family member.
  

• Interest income reflected in AIS but missed while filing.
  

• Mismatch between income reported in Form 16, Form 26AS, and AIS.
  

• Capital gains or dividends reported under incorrect heads or periods.
  

• Errors in data reported by banks, mutual funds, or employers.
  

These discrepancies are often unintentional but can lead to mismatch notices under sections like 143(1)(a) or 139(9), demanding clarification or revision of the return.

How to Correct AIS Mismatch Step-by-Step

Correcting an AIS mismatch is a straightforward process if handled systematically. Taxpayers should follow these steps to ensure accuracy before filing:

• Access the AIS Portal Log in to the Income Tax e-filing portal using your PAN and password. Under the “Services” section, select “Annual Information Statement (AIS),” which redirects you to the AIS portal.
  

• Download and Review AIS Data Download both the AIS and Taxpayer Information Summary (TIS) in HTML or PDF format. Compare these with your Form 16, Form 26AS, and bank or broker statements.
  

• Identify Errors Look for duplicates, incorrect amounts, or entries not related to your PAN. Pay close attention to TDS and interest income.
  

• Submit Feedback for Correction For each incorrect transaction, select “Submit Feedback.” Choose from options like “Information is incorrect,” “Relates to another PAN/year,” or “Duplicate.” Enter the correct values and submit remarks.
  

• Wait for Update or File with Explanation The Income Tax Department reviews your feedback and updates the AIS if accepted. If updates are pending, file your ITR with an explanation to prevent notices.
  

Impact of AIS Mismatch on Income Tax Notices

An unresolved AIS mismatch can lead to automated tax notices and delays in refund processing. The Income Tax Department cross-verifies data from AIS, TIS, and ITR before processing returns.

• Section 143(1)(a): Adjustments for mismatched income or TDS.
  

• Section 139(9): Issued for defective returns that require correction.
  

• Section 148: Used for reopening assessments when undisclosed income is suspected.
  

Failure to respond can result in penalties, additional tax liability, or reassessment. Ensuring that AIS and ITR data match helps taxpayers maintain compliance and avoid scrutiny.

Legal Remedies for AIS Mismatch After Filing ITR

If mismatches are detected after filing, taxpayers can still correct them through two legal options:

• Revised Return under Section 139(5): Allows correction of errors or omissions in the original ITR before the end of the relevant assessment year or completion of assessment, whichever is earlier.
  

• Rectification under Section 154: Applicable when mistakes are apparent from the record, such as calculation errors or unintentional omissions. The taxpayer can file a rectification request online through the Income Tax portal.
  

Both options ensure compliance and protect taxpayers from further action or penalties.

How to Prevent Future AIS Mismatches

Preventing mismatches requires diligence before filing:

• Always download and review AIS, TIS, and Form 26AS before submission.
  

• Cross-verify salary, TDS, interest, and capital gain details with official documents.
  

• Avoid using multiple bank accounts for the same transactions.
  

• Report all sources of income, including savings and fixed deposit interest.
  

• File using reliable platforms that automatically validate AIS and TDS data.
  

Adopting digital tools for real-time error detection can save time and reduce risk.

How TaxBuddy Helps with AIS Mismatch Correction

TaxBuddy simplifies the entire process of identifying and fixing AIS mismatches through AI-driven data comparison and expert review. The platform automatically matches income, TDS, and investment data across AIS, TIS, and Form 26AS. Users are guided on submitting accurate feedback and filing their returns with confidence.

For complex cases or when mismatches involve multiple transactions, TaxBuddy’s expert-assisted plans ensure accurate representation and prevent notice-triggering errors. With TaxBuddy, taxpayers can rely on a seamless and compliant filing experience.

Long-Tail Scenarios: AIS Mismatch and Bank Account Details

Bank account details play an important role in refund processing and data validation. Sometimes, AIS may display incorrect or missing bank information. This typically occurs when financial institutions delay or misreport updates to the Income Tax Department.

Taxpayers should review all bank entries in AIS to ensure accuracy. If incorrect details appear, feedback should be submitted under “Information relates to another person/year” or “Information is incorrect.”

Updating bank details on the e-filing portal ensures refunds are processed smoothly and associated transactions are properly linked to your PAN.

Conclusion

Rectifying AIS mismatches before filing your return is essential for maintaining accurate records and preventing unwanted tax notices or delays. By proactively checking your AIS and submitting timely feedback, taxpayers can ensure their ITR reflects the correct data. Platforms like TaxBuddy simplify this entire process by integrating AI-based checks and expert review features, helping users correct errors effortlessly. For anyone looking for assistance in tax filing, it is highly recommended to use the TaxBuddy mobile app for a simplified, secure, and hassle-free experience.

FAQs

Q1. Does TaxBuddy offer both self-filing and expert-assisted plans for ITR filing, or only expert-assisted options? TaxBuddy provides flexibility for every kind of taxpayer. Those who prefer independence can use the self-filing plan, powered by an intuitive AI interface that guides users step-by-step and automatically verifies income, deductions, and TDS data. For individuals with complex income sources such as business, capital gains, or foreign assets, TaxBuddy’s expert-assisted plan connects users with certified tax professionals who prepare, review, and file the return on their behalf. This dual approach ensures that both first-time filers and advanced users can file with confidence and accuracy.

Q2. Which is the best site to file ITR? The Income Tax Department’s e-filing portal is the official platform for filing returns. However, it may not always be user-friendly, especially for those with limited tax knowledge. For a smoother and more guided experience, TaxBuddy is considered one of the best alternatives. It automates data fetching from AIS, TIS, and Form 26AS, checks for mismatches, and minimizes errors through AI-driven validation. Additionally, users can access expert support and personalized assistance, making TaxBuddy a more efficient and reliable platform for filing ITRs online.

Q3. Where to file an income tax return? An income tax return can be filed through the official Income Tax Department’s e-filing portal (www.incometax.gov.in) or through authorized platforms like TaxBuddy. Filing through TaxBuddy provides additional benefits such as pre-filled data imports, instant validation of AIS and Form 16, automated deduction recommendations, and access to expert guidance. This makes the entire process faster, easier, and more secure compared to manual entry on the government portal.

Q4. What is the Annual Information Statement (AIS)? The Annual Information Statement (AIS) is a consolidated record of a taxpayer’s financial transactions as captured by the Income Tax Department. It includes income details like salary, interest earned on bank deposits, mutual fund investments, dividends, TDS deductions, and property transactions. The AIS helps the department cross-verify whether taxpayers have accurately reported their income and claimed deductions. It also serves as a self-check tool for taxpayers to ensure their ITR reflects the same information that the department has on record.

Q5. How can AIS mismatches be identified? To detect an AIS mismatch, taxpayers should first download their AIS and Taxpayer Information Summary (TIS) from the Income Tax e-filing portal. They must then compare the entries with their Form 16, bank statements, broker reports, and investment proofs. Discrepancies such as duplicate entries, incorrect TDS amounts, or transactions not related to the taxpayer indicate an AIS mismatch. Identifying these differences early allows for timely correction and prevents tax notices or refund delays later.

Q6. What happens if a taxpayer files ITR without correcting AIS mismatch? If an ITR is filed without addressing mismatches, the system may detect inconsistencies and issue notices under various sections of the Income Tax Act. For instance, Section 143(1)(a) allows for adjustments based on mismatched income or deductions, while Section 139(9) categorizes such returns as defective. In more serious cases, reassessment notices under Section 148 may be issued. These can lead to delayed refunds, interest charges, or penalties, making it crucial to fix mismatches before submission.

Q7. Can AIS mismatches be corrected after filing ITR? Yes. If mismatches are discovered post-filing, taxpayers can correct them through two legal options. They can file a revised return under Section 139(5) if the assessment for that year has not been completed, allowing them to report correct data. Alternatively, if the mismatch arises due to an apparent mistake or system error, they can request rectification under Section 154 on the e-filing portal. Both options help rectify data inconsistencies and prevent future scrutiny.

Q8. How long does it take for AIS feedback to reflect? After submitting feedback for correction on the AIS portal, the update timeline depends on the verification process by the Income Tax Department. Generally, it may take anywhere from a few days to several weeks for changes to appear. Once processed, the corrected data will be visible in the AIS and reflected in the Taxpayer Information Summary (TIS). Taxpayers are advised to wait for the update or file their ITR with an attached explanation if deadlines are near.

Q9. Can incorrect bank details in AIS cause refund delays? Yes. If the bank account details in the AIS do not match those declared in the ITR, the refund may not be processed to the correct account. Incorrect or outdated information could lead to delays or rejection of refund payments. To avoid this, taxpayers must verify and update their bank account details both in their AIS and on the e-filing portal before filing. Ensuring pre-validation of the refund account helps the Income Tax Department transfer refunds without complications.

Q10. How can feedback be submitted for bank transaction errors in AIS? When a transaction related to bank income or deposits appears incorrectly in AIS, taxpayers can submit feedback through the AIS portal. Each transaction listed in the statement includes a “Submit Feedback” option. Users can select from categories such as “Information is incorrect,” “Relates to another PAN,” or “Duplicate information.” They should enter the correct value or explanation, attach remarks, and submit it. Once validated by the department, the AIS is updated accordingly.

Q11. How can taxpayers prevent AIS mismatches in future years? Prevention begins with careful financial recordkeeping. Taxpayers should maintain updated records of salary slips, TDS certificates, and investment statements. Before filing, they must download AIS, TIS, and Form 26AS to cross-verify figures. Using a reliable tax filing platform like TaxBuddy also helps, as it automatically matches these data sources and flags mismatches instantly. By filing through AI-driven systems, taxpayers reduce the likelihood of manual errors and ensure their returns remain compliant.

Q12. How does TaxBuddy simplify AIS correction? TaxBuddy’s platform uses AI-powered automation to detect and reconcile mismatches between AIS, TIS, and ITR data in real time. It highlights discrepancies, suggests corrections, and assists users in submitting the right feedback to the Income Tax Department. In cases involving multiple mismatches or complex entries, expert support is available to handle the corrections professionally. By combining automation with human expertise, TaxBuddy ensures accurate, compliant, and hassle-free filing for every taxpayer.