Common Mistakes in Belated ITRs That Trigger Section 143(1) Notices

Farheen Mukadam
Jul 17, 2025
10 min read

Filing your Income Tax Return (ITR) on time is essential to avoid penalties and ensure compliance with tax laws. However, many taxpayers may miss the filing deadline and end up submitting a belated return. While filing a belated ITR is still possible, it can lead to scrutiny from the Income Tax Department. One common outcome of late filing is the receipt of a Section 143(1) notice. This notice typically highlights discrepancies or errors in the filed return that require correction. Understanding common mistakes that trigger such notices and learning how to avoid them can save taxpayers from unnecessary delays and penalties.

Common Mistakes in Belated ITRs That Trigger Section 143(1) Notices

When filing a belated ITR, many taxpayers make mistakes that can trigger a Section 143(1) notice, prompting the Income Tax Department to review their returns more closely. Some common mistakes include:

Incorrect Reporting of Income: One of the most common errors in belated returns is the incorrect reporting of income. Whether its unreported income from a secondary source or wrong figures entered for salary or business income, mismatches in reported income often trigger notices for further clarification.
Missing or Incorrect TDS Claims: Failure to claim the correct Tax Deducted at Source (TDS) amount or reporting it inaccurately can lead to discrepancies. If the TDS reflected in your Form 26AS doesn’t match the TDS claimed on your ITR, the department may issue a notice under Section 143(1) for further verification.
Mismatch in Deductions or Exemptions: Claiming deductions or exemptions incorrectly or without proper supporting documentation can raise red flags. For instance, claiming HRA exemptions without submitting the required proof or incorrectly applying deductions under Section 80C can lead to notices.
Underreporting of Taxable Assets or Liabilities: Not reporting assets such as bank interest, capital gains, or other income can lead to discrepancies. Similarly, underreporting liabilities, such as outstanding loans or debts, can result in mismatches when compared with tax records.
Calculation Errors: Simple errors in tax calculations, such as wrong application of the applicable tax rates, incorrect rebates, or failure to account for changes in the tax regime, can lead to mismatches, prompting the department to issue a Section 143(1) notice.
Failure to Disclose Foreign Assets/Income: If you have foreign income or assets and fail to disclose them in your ITR, it may trigger a Section 143(1) notice. The government takes these omissions seriously, especially with increased focus on black money and tax evasion.

Why Section 143(1) Notices Are Issued for Belated ITRs

Section 143(1) of the Income Tax Act deals with the processing of returns filed under sections 139, 142, and 148. For belated ITRs, notices are generally issued to address discrepancies or errors detected during the processing of the return. These notices are sent to notify the taxpayer about mistakes, omissions, or mismatches in the filed return. There are several reasons why the Income Tax Department issues Section 143(1) notices for belated returns:

Error Detection: The primary reason for the issuance of a Section 143(1) notice is the detection of errors or discrepancies in the filed return. The department reviews the return for accuracy and ensures that all income is correctly reported, taxes are appropriately paid, and deductions or exemptions are properly claimed.
Verification of TDS Credits: The department cross-checks the TDS credits claimed by the taxpayer with the records available in Form 26AS. If any discrepancies are found, a notice may be issued to seek clarification or rectify the errors.
Income Mismatch: If there is an income mismatch between the details provided by the taxpayer and the details in the tax database, such as discrepancies with Form 16 or Form 26AS, a Section 143(1) notice is likely to be issued to correct the issue.
Incomplete or Incorrect Filing: Incomplete details or misrepresentation of facts can trigger a notice. For example, if a taxpayer omits details about foreign income, capital gains, or other sources of income, the department may issue a notice requesting clarification.
Calculation Errors: Section 143(1) notices are also issued when there are mistakes in the calculation of taxes, leading to mismatches in the tax amount due and the refund expected.

How to Avoid These Mistakes

Filing a belated Income Tax Return (ITR) can be daunting, especially when dealing with the pressure of missing deadlines and avoiding unnecessary scrutiny. To minimize errors and avoid penalties, it is essential to take certain precautions during the filing process. Mistakes in a belated ITR can lead to delays, notices under Section 143(1), or even a potential tax audit. Below is a detailed guide on how you can avoid common mistakes while filing a belated ITR:

Ensure Accurate Reporting of Income

One of the most critical aspects of filing your ITR is accurately reporting all sources of income. Many taxpayers fail to include all their income, leading to discrepancies that can trigger notices from the Income Tax Department.

Salary Income: Ensure that your salary income is correctly reported in the ITR. Cross-check the details with your Form 16 (issued by your employer). Ensure that any bonuses, allowances, or commissions that should be included are properly added to your total salary income.
Other Sources of Income: Other than salary, taxpayers often forget to include income from sources such as interest on savings accounts, fixed deposits, or rental income. Cross-check your bank statements and any other income-generating documents to ensure all income is accounted for.
Business Income: If you are a business owner, accurately report your business income and expenses. This includes income from freelance work, partnerships, or other professional engagements. Ensure that any deductible business expenses are also correctly claimed.

Tip: Use a reliable tax filing tool like TaxBuddy, which can help you review all sources of income and ensure that every detail is accounted for.

Verify TDS Information

Tax Deducted at Source (TDS) is one of the most common areas where mistakes occur. TDS is deducted by your employer, bank, or other deductors, and it is your responsibility to ensure that these details are correctly reflected in your ITR.

Form 26AS: Your Form 26AS is a consolidated tax statement that lists the TDS deducted on your behalf and paid to the government. Before filing your return, cross-check the TDS amounts in your ITR with what is reported in Form 26AS.
Discrepancies: If you find any discrepancies between your TDS records and the Form 26AS, contact your employer or the deductor immediately to resolve the issue. If you file the return with incorrect TDS details, it can trigger notices or delays in your refund.
Manual TDS Reporting: In some cases, you may need to manually enter TDS details into the ITR if they don’t automatically reflect in your Form 26AS. Ensure that you input the correct TAN number, the amount of TDS, and the corresponding financial year.

Document and Verify Deductions/Exemptions

Tax deductions and exemptions play a significant role in reducing your taxable income. However, improper claims or lack of supporting documentation can lead to errors, audits, or penalties.

Section 80C Investments: Deductions under Section 80C (such as contributions to Provident Fund, PPF, Life Insurance premiums, etc.) are commonly claimed. Before claiming these deductions, ensure that you have all supporting documents such as receipts, proof of payment, or investment certificates.
House Rent Allowance (HRA): If you are claiming HRA as a deduction, ensure that you have your rent receipts and landlord details. HRA exemptions are often scrutinized, and you may need to provide additional documents if requested.
Other Deductions: Verify other deductions such as those under Section 80D (health insurance), Section 80E (education loan), and Section 80G (donations). Keep all receipts, certificates, and proofs required to back up your claims.

Tip: Keep all tax-saving documents organized throughout the year so that you don’t miss out on any potential deductions during tax filing.

Use Tax Filing Software or Professional Help

The complexity of tax filings, especially for businesses or individuals with multiple sources of income, can lead to errors if done manually. Using a tax filing software like TaxBuddy can significantly reduce the risk of mistakes.

Automated Calculations: TaxBuddy automatically calculates your taxable income, deductions, and tax payable. This reduces the chance of calculation errors that are common in manual filings.
Guidance for Complex Returns: If your return involves multiple income sources or deductions, consider opting for professional help. TaxBuddy’s expert-assisted plans provide personalized advice and ensure that your return is accurate, minimizing the chances of errors.
Filing Made Easy: Tax filing software also helps with error detection by highlighting discrepancies before the final submission, ensuring that your return is free from mistakes.

Review for Foreign Assets/Income Disclosure

One of the most commonly overlooked areas is the disclosure of foreign assets or income. The Indian government places high importance on the accurate reporting of foreign income or assets under the Income Tax Act.

Foreign Income: If you have any foreign income, such as earnings from overseas employment or investments, ensure that it is fully disclosed in your ITR. The government is strict about this and failing to disclose foreign income can lead to serious penalties or audits.
Foreign Assets: Similarly, if you own any foreign assets (bank accounts, property, etc.), these need to be declared. The Income Tax Department cross-checks foreign assets and income, and non-disclosure can lead to legal complications.
FATCA Compliance: Ensure that your ITR is compliant with the Foreign Account Tax Compliance Act (FATCA), which mandates the disclosure of foreign bank accounts.

Cross-Verify Calculations

Lastly, cross-check all calculations before submitting your return. Many errors are caused by simple calculation mistakes, such as applying the wrong tax rate or failing to account for the correct number of exemptions.

Taxable Income: Double-check your taxable income and ensure that all income sources, deductions, and exemptions are accounted for correctly.
Tax Payable: Verify that the correct tax slabs and rates have been applied to your taxable income. TaxBuddy’s automated system can perform this task to ensure you are calculating your taxes accurately.
Refund Calculation: If you are expecting a refund, cross-check the refund calculation. Ensure that the tax paid, including TDS, matches your final tax liability.

Tip: Always use a tax filing tool like TaxBuddy, which can handle complex calculations and ensure accurate reporting.

Conclusion

Filing a belated Income Tax Return (ITR) may offer a safety net for those who missed the original deadline, but it carries the risk of receiving a Section 143(1) notice. The key to avoiding such notices lies in careful, accurate filing. By thoroughly reviewing your income, TDS claims, deductions, and tax calculations, you can significantly reduce the likelihood of discrepancies. Using reliable tax filing platforms like theTaxBuddy mobile appensures that your ITR is filed without errors. Additionally, seeking professional assistance when needed provides further peace of mind. Timely and accurate filing not only helps avoid penalties but also ensures compliance with tax authorities, preventing unnecessary complications and stress.

FAQs

Q1: What is a Section 143(1) notice?

A Section 143(1) notice is an intimation issued by the Income Tax Department after processing your filed return. This notice highlights any discrepancies, errors, or issues identified during the processing of the return. It typically involves mismatches in reported income or TDS claims, and requires you to take corrective actions.

Q2: What should I do if I receive a Section 143(1) notice?

If you receive a Section 143(1) notice, first carefully review the details mentioned in the notice. It will specify the errors or discrepancies found in your ITR. If it involves income mismatch or incorrect TDS claims, you may need to file a revised return or provide clarification and supporting documents to rectify the issues.

Q3: Can I correct my ITR after filing?

Yes, if you discover mistakes in your ITR after submitting it, you can file a revised return. The revised return must be submitted before the end of the assessment year. This allows you to correct any errors, such as misreported income or missed deductions, and avoid penalties.

Q4: What is the penalty for errors in my ITR?

If there are errors in your ITR, you may incur penalties, which can include fines for late submission, interest on unpaid taxes, or scrutiny by the tax authorities. The penalty amount varies depending on the nature of the error, so ensuring accurate filing is crucial to avoid these consequences.

Q5: How can I avoid mistakes in my ITR?

To avoid mistakes in your ITR, carefully review all income statements, verify TDS credits, ensure correct deductions with proper documentation, and use reliable filing platforms or professional help. Platforms like TaxBuddy provide tools to check for common errors, making it easier to file accurately and on time.

Q6: What if I missed claiming a deduction in my ITR?

If you missed claiming a deduction while filing your ITR, you can file a revised return to include the missed deduction. This will correct your tax calculation and may lead to a refund. The revised return must be filed before the end of the assessment year.

Q7: Can I submit additional documents after filing my ITR?

Once your ITR is filed, you cannot submit additional documents unless the Income Tax Department asks for them or if you are filing a revised return. However, it's always best to ensure all required documents are submitted during the initial filing.

Q8: How long do I have to file a revised ITR?

You must file a revised ITR before the end of the assessment year. The assessment year ends 12 months after the relevant financial year, so ensure you submit your revised return within this time frame.

Q9: How does TaxBuddy help avoid errors in ITR filing?

TaxBuddy offers an intuitive platform that helps reduce errors by guiding you through the tax filing process. It verifies key details, checks for common mistakes, and offers expert assistance when needed, ensuring that your ITR is filed accurately and on time.

Q10: What happens if I don’t file my ITR by the deadline?

If you miss the deadline, you can still file a belated return by the extended deadline, but penalties will apply. Additionally, your refund will be delayed, and you may be subject to interest on any unpaid taxes.

Q11: Can I file my ITR using a mobile app?

Yes, TaxBuddy offers a mobile app that allows you to file your ITR directly from your phone. The app provides a user-friendly interface, ensuring you can file your taxes easily and accurately, even on the go.

Q12: Does TaxBuddy support all ITR forms?

Yes, TaxBuddy supports all types of ITR forms, including those for individuals, businesses, and professionals. The platform is designed to handle different types of income and deductions, ensuring comprehensive filing for all tax scenarios.