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Income tax notices often arise due to mismatches, missing information, or reporting errors, making compliance challenging for freelancers and business owners. Notices may relate to unreported income, incorrect tax filings, or scrutiny assessments that require prompt and accurate clarification. TaxBuddy offers a structured system that analyses notices, segments them by type, and guides users through resolution using expert oversight and automated checks. This ensures clarity

Section 245 refund adjustment notices are issued when the Income Tax Department proposes to set off a current-year refund against outstanding tax demands from earlier years. The notice outlines the refund amount, the pending demand, and the proposed adjustment, requiring a response within the specified timeline. Understanding how these set-offs work, how to verify the accuracy of the demand, and how to submit an objection is essential for ensuring refunds are not withheld in

Foreign Tax Credit (FTC) allows relief when tax is paid abroad on income taxable in India, but errors in Form 67 often trigger defect notices that delay refunds or deny credit. These notices commonly arise from mismatches in income details, incorrect currency conversion, late filing, or incomplete documentation. Accurate disclosure under Rule 128 is essential, as the Income Tax Department cross-checks Form 67 with Schedule FSI and foreign tax proofs. With multiple steps invo

Section 80G donation mismatches have become one of the most common reasons for automated income tax notices. With mandatory reporting through Form 10BD by charitable institutions, even genuine donations can be disallowed if the data does not match the taxpayer’s ITR. Missing Form 10BE, incorrect PAN details, invalid registration status of the trust, or wrong reporting under Schedule 80G often trigger notices during processing. These mismatches usually surface through Section

Advance tax underpayment under Sections 234B and 234C leads to interest charges when total liability exceeds ₹10,000 and required installments are missed or delayed. Accurate calculation depends on identifying shortfalls, mapping payments to statutory deadlines, and determining the correct period for interest application. Most notices arise due to gaps between expected tax payments and reported credits in Form 26AS or missed installments. TaxBuddy automates this computation

Bank account errors are among the most common reasons for income tax notices, refund failures, and unexpected demands under sections like 139(9) and 143(1) of the Income Tax Act 1961. A single mismatch in IFSC, account number, pre-validation status, or PAN linkage often disrupts refund processing and triggers automated adjustments during ITR processing. When the system cannot credit the refund, it may issue a rectification request or convert the failed refund into a demand. P

AIS “Other Information” items often trigger unexpected income tax notices, even when reported income appears accurate. These data points include bank account opening details, KYC mismatches, dormant accounts, foreign assets, or cash-related disclosures reported by third parties. Many taxpayers overlook these entries because they do not directly reflect income figures. The Income Tax Department relies on this information to cross-check compliance, leading to notices under Sect

Income tax notices for senior citizens often arise from mismatches in pension reporting, interest from multiple bank FDs, high-value transactions, or incomplete AIS disclosures. Automated systems detect even minor differences between reported income and data from banks or pension authorities. This creates stress for retirees who rely on predictable financial routines. Clear rules exist for senior citizens and super senior citizens, yet many still face notices due to overlooke

Corporate ESOPs and bonuses often lead to income tax confusion for employees, especially when perquisite taxation, capital gains, or salary mismatches trigger notices from the Income Tax Department. Errors usually arise due to differences between Form 16, AIS, and actual reporting in the ITR. ESOP taxation happens at multiple stages, while bonuses are closely monitored through TDS data. Without proper reconciliation, even genuine income disclosures can result in scrutiny. Pla

Bulk cash deposits made after selling a property often attract the attention of the Income Tax Department. These deposits are tracked through banking and reporting systems and matched against income tax returns to verify whether the source of funds has been properly disclosed. When the numbers do not align, notices are issued seeking clarification. Such situations are common after property transactions, especially where sale proceeds are received partly or fully in cash. Addr