5 Things DIY Filers Often Misreport (And We Fix in Assisted)
- Nimisha Panda
- Sep 17
- 9 min read
Filing income tax returns in India can be daunting for DIY filers. Small errors in reporting personal details, income, or deductions can lead to delays, notices, or penalties. Choosing the wrong ITR form, missing income sources, or failing to reconcile Form 26AS are common pitfalls. Assisted filing platforms like TaxBuddy help identify and correct these mistakes, ensuring a smooth, accurate, and stress-free filing process. Understanding these common misreporting issues is key to avoiding complications and maximising legitimate tax benefits.
Table of Contents
Incorrect Personal Details
One of the most common errors encountered during ITR filing is the submission of incorrect personal information. This can include mistakes in basic details such as the taxpayer's name, PAN, Aadhaar number, bank account information, or residential address. Even seemingly minor errors, such as a misspelled name or a transposed digit in a bank account number, can have significant consequences. For instance, discrepancies between the PAN or Aadhaar provided in the ITR and official records can trigger verification issues, potentially leading to rejection of the return. Similarly, incorrect bank account details may prevent the direct deposit of refunds, causing unnecessary delays. Errors in the address or contact information could result in important notices from the Income Tax Department being sent to the wrong location, increasing the risk of missing deadlines or additional scrutiny. Therefore, it is essential for taxpayers to carefully verify that all personal information matches official records before submission, ensuring smooth processing and minimizing the likelihood of follow-ups or additional documentation requests.
Choosing the Wrong ITR Form
Another frequent mistake is selecting an incorrect ITR form for filing. The Income Tax Department provides multiple ITR forms, each designed for specific categories of taxpayers and types of income. For example, salaried individuals with no business income are required to file ITR-1, whereas taxpayers with capital gains, foreign income, or multiple sources of income may need to file ITR-2, ITR-3, or other applicable forms. Filing under the wrong form can create complications such as rejection of the return or requests for revised submissions, which not only consume additional time but may also delay refunds. Additionally, incorrect form selection can lead to errors in reporting income, claiming deductions, or calculating tax liability, increasing the risk of scrutiny or notices from the tax authorities. To avoid these issues, taxpayers should carefully assess their income sources and review the eligibility criteria for each ITR form. Ensuring the correct form is selected from the outset simplifies the filing process, reduces the chances of errors, and supports timely processing of refunds.
Omitting Certain Income Sources
Omitting certain sources of income is a frequent mistake that can create significant issues during the income tax filing process. Many taxpayers fail to include earnings from all applicable sources, such as rental income from properties, freelance or gig-based earnings, dividends from investments, or capital gains from the sale of assets like stocks or property. When these sources are not reported, the Income Tax Department can detect discrepancies by comparing the return filed with information available in Form 26AS, bank statements, or other financial records. Such mismatches often trigger notices, requiring additional documentation or explanations, and can delay refunds or even lead to penalties. Ensuring that every source of income is accurately disclosed is essential not only for compliance but also to maintain a clean record with the tax authorities and avoid potential disputes in the future.
Incorrect or Missed Deductions and Exemptions
Incorrect or missed deductions and exemptions are another area where taxpayers commonly make errors, which can directly affect the total tax liability. Sections such as 80C, 80D, and 80E, as well as exemptions like HRA, provide opportunities to reduce taxable income, but miscalculations or oversights in claiming these benefits can result in higher taxes than necessary. For example, failing to claim contributions to life insurance, retirement funds, or education loans under the relevant sections can significantly increase the taxable amount. Similarly, misreporting HRA exemptions without proper calculation or documentation may lead to scrutiny or rejection of the claim. A careful review of all eligible deductions and exemptions before filing ensures that taxpayers pay only what they are legally required to, optimizes their tax planning, and reduces the likelihood of receiving correction notices or incurring penalties. Accurate application of these deductions is not just a matter of compliance but also an effective strategy to manage tax liability efficiently.
Mismatches with Form 26AS and Bank Details
One of the most common reasons for delays in processing Income Tax refunds is discrepancies between the information reported in your ITR and Form 26AS. Form 26AS serves as a consolidated record of all tax credits associated with your PAN, including Tax Deducted at Source (TDS), Tax Collected at Source (TCS), and advance tax payments. If the income, TDS, or deductions reported in your ITR do not match the entries in Form 26AS, the Income Tax Department may flag the return for verification, leading to delays in refund processing. Similarly, incorrect bank account details in your ITR, such as an incorrect account number or IFSC code, can prevent refunds from being credited to your account. Even a minor mismatch in personal details like name spelling or PAN linking can trigger notices and slow down the refund process. Ensuring that your return, Form 26AS, and bank account information are fully aligned is crucial for smooth, timely processing of refunds.
How Assisted Filing Fixes These DIY Errors
Expert-assisted platforms like TaxBuddy are designed to help taxpayers avoid these common pitfalls. TaxBuddy’s system automatically cross-checks your ITR details against Form 26AS, ensuring that all income sources, TDS credits, and deductions are accurately reflected. The platform also verifies personal details and bank account information, minimizing errors that could delay refunds. TaxBuddy guides users in selecting the correct ITR form based on their income type, ensuring compliance with the latest regulations and preventing mismatches. Additionally, the platform helps optimize deductions under various sections of the Income Tax Act, which can reduce tax liability legally and efficiently. By combining automated verification with expert guidance, TaxBuddy significantly reduces the risk of mismatch notices, errors in filing, and potential penalties. Taxpayers using the platform can expect a faster, more seamless refund experience while maintaining complete compliance with tax laws.
Conclusion
Common ITR filing errors such as incorrect personal details, wrong form selection, missed income, or deductions can cause delays, penalties, and additional work. Using expert-assisted filing solutions like TaxBuddy ensures accuracy, compliance, and faster processing of refunds. For anyone looking for assistance in tax filing, it is highly recommended to download 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 offers a range of flexible options designed to meet the needs of different taxpayers. Users can choose a self-filing plan, where the platform provides step-by-step guidance, helping them navigate the entire ITR filing process independently. This option is ideal for individuals who are comfortable entering their income, deductions, and exemptions themselves but still want guidance to ensure accuracy. Alternatively, users can opt for expert-assisted plans, where certified tax professionals review all details, prepare the return, and file it on behalf of the taxpayer. This ensures accuracy, compliance, and peace of mind, especially for those with multiple income sources or complex tax situations. The combination of both options allows users to select the plan that suits their comfort level and expertise, whether they prefer complete independence or professional assistance.
Q2. How can I avoid mismatches between my ITR and Form 26AS? Mismatches between ITR and Form 26AS are a common source of delays in refund processing and can sometimes trigger notices from the Income Tax Department. To avoid this, it is crucial to ensure that all TDS, advance tax payments, and self-assessed taxes reported in Form 26AS are accurately reflected in the ITR. TaxBuddy simplifies this process by automatically fetching TDS and other tax credits from the database and cross-verifying them against the user’s entered details. The platform highlights any discrepancies before submission, enabling users to correct errors or omissions proactively. This feature significantly reduces the chances of processing delays, mismatched records, or unnecessary correspondence with the tax department.
Q3. What happens if I choose the wrong ITR form? Selecting the wrong ITR form can result in your return being rejected or the need to file a revised return, which may cause delays in processing refunds or increase the chances of scrutiny. TaxBuddy prevents this by analyzing the user’s income sources, deductions, and exemptions to recommend the correct form. For example, salaried individuals without additional income sources are directed to ITR-1, while individuals with business income, capital gains, or foreign assets may be guided to ITR-2 or ITR-3. This automatic identification helps prevent errors, ensures compliance with tax regulations, and streamlines the filing process.
Q4. Can missing deductions affect my refund? Yes, not claiming eligible deductions can reduce the amount of refund a taxpayer is entitled to. TaxBuddy’s platform helps identify all eligible deductions for the financial year, including standard deductions, house rent allowance (HRA), education loan interest, and contributions under Sections 80C, 80D, and other applicable sections. The system automatically suggests these deductions based on the user’s profile and income details, ensuring that no eligible benefits are missed. By claiming all valid deductions, taxpayers can maximize their refund while staying fully compliant with income tax laws.
Q5. How does TaxBuddy verify bank account details for refund processing? TaxBuddy ensures that refunds are credited safely and promptly by validating bank account information through multiple checks, including IFSC code verification and account number confirmation. The platform securely cross-checks these details with official bank records before submitting the ITR. This reduces the risk of delays, returns being rejected, or funds being credited to incorrect accounts. By confirming the account details beforehand, TaxBuddy provides users with confidence that their refunds will be processed efficiently and reach their verified accounts directly.
Q6. Is it necessary to report all income sources in ITR? Yes, it is mandatory to report all taxable income, including salary, rental income, business or professional income, interest from bank deposits, and capital gains from the sale of assets. Omitting income can trigger notices from the Income Tax Department and may lead to penalties or additional scrutiny. TaxBuddy helps users identify all sources of income accurately and includes them in the ITR, minimizing the risk of errors or omissions. The platform also guides on the correct treatment of each income type, ensuring complete compliance and avoiding legal complications.
Q7. Can DIY filing lead to penalties for minor errors? Even small errors, such as incorrect PAN, mismatched TDS, or misreported income, can result in notices, penalties, or delays in refund processing. TaxBuddy’s self-filing platform is designed to prevent such issues through real-time validation and error checks. The system highlights potential mistakes before submission, allowing users to correct them instantly. This ensures that even individuals who choose to file independently can submit an accurate return, reducing the chances of notices or penalties.
Q8. Does TaxBuddy guide in claiming HRA or other exemptions? Yes, TaxBuddy provides detailed guidance for calculating and claiming exemptions such as HRA, Leave Travel Allowance (LTA), and standard deductions. The platform explains how to enter all relevant details accurately, including rent paid, city of residence, and employer-provided allowances. By automating these calculations and highlighting eligible exemptions, TaxBuddy helps taxpayers maximize their benefits under both the old and new tax regimes. Users can be confident that they are claiming the correct exemptions without missing any opportunities to reduce taxable income.
Q9. How quickly are refunds processed after assisted filing through TaxBuddy? Refund timelines depend on the processing speed of the Income Tax Department, but filing correctly and early can accelerate the process. Returns filed through TaxBuddy’s expert-assisted plan are typically processed faster because they are prepared with error-free information, verified TDS, and accurate bank details. The professional review ensures compliance, reducing the likelihood of delays caused by mismatches, missing documentation, or incorrect data. While the exact timeline varies, users can generally expect a smoother and faster refund experience when filing through TaxBuddy.
Q10. Can I revise my ITR if an error is found after filing? Yes, taxpayers can file a revised return under Section 139(5) if errors or omissions are detected after submission. TaxBuddy guides users through the process of revising their return, highlighting the areas that require correction. The platform simplifies updating details such as income, deductions, or exemptions, helping users avoid penalties and ensure compliance. By making revisions before the deadline for belated or revised returns, taxpayers can correct errors efficiently and maintain accurate records with the Income Tax Department.
Q11. How does TaxBuddy prevent errors in personal details? TaxBuddy validates critical personal information, including PAN, Aadhaar, and bank account details. The platform flags inconsistencies and prompts the user to correct them before submission. This proactive validation prevents common mistakes that could lead to return rejection, delayed refunds, or notices from the Income Tax Department. Users can file with confidence, knowing that their personal information is accurately captured and verified.
Q12. Is the TaxBuddy mobile app secure for storing sensitive tax information? Yes, the TaxBuddy mobile app uses end-to-end encryption, secure cloud storage, and strict access controls to protect sensitive personal and financial information. The platform ensures that all data remains confidential while offering a seamless, mobile-friendly interface for ITR filing. Users can safely store and manage their tax documents, track refund status, and file returns without worrying about data breaches or unauthorized access. The combination of robust security measures and an intuitive interface makes TaxBuddy a reliable solution for secure and hassle-free tax filing.
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