Income Tax Notice
Got an Income Tax Notice?
No need to worry! TaxBuddy is at your service.
Handling an Income Tax Notice has never been simpler!
.png)
.png)
Reasons for Receipt of Income Tax Notice
An income tax notice is simply an official communication from the Income Tax Department to the taxpayer for a variety of reasons. The reasons could be differences found in the ITR submitted, the need for additional documentation, or a notice to the taxpayer for a personal appearance. The common causes for an income tax notice are:
Mismatch in TDS (Tax Deducted at Source) details.
Discrepancy between income declared and income as per Form 26AS.
Non-disclosure of all sources of income.
High-value transactions do not match the reported income.
Late or non-filing of Income Tax Return (ITR).
Random scrutiny selection by the IT department.
Claiming higher than usual deductions or exemptions.
Investments or savings not reported or mismatched.
Foreign assets or income not disclosed.
Cash deposits exceeding specified limits.
Discrepancy in GST and Income Tax filings.
Errors in ITR form or incorrect PAN details.
Failure to report property sale or purchase.
Significant changes in income from previous years.
Notice for routine verification or assessment.
Types of Income Tax Notice
Understanding different types of Income Tax Notices can help to clear up any confusion and eliminate future concerns. Let’s have a look on the different types of notices or intimations issued by the Income Tax Department:
Notices include:
Appellate Notices
When someone disagrees with a decision of the department and wishes to file an appeal, they can expect an appellate notice.
Ex-Parte Orders
These notices indicate that a decision has been made without a person’s individual participation or compliance.
Seeking Rectification
Rectification notices seek the correction of errors or omissions in previous proceedings by submitting supporting documents.
Steps After Receiving an Income Tax Notice
After receiving a notice from the Income Tax Department, it is critical to approach the situation with care and order. Follow these steps to effectively manage the notice:
Read the Notice Thoroughly:
Understand the reason behind the notice, including what the Income Tax Department is asking for or pointing out.
Verify Your Details:
Make sure the notice is meant for you by checking your personal details like name, PAN, address, and the relevant assessment year.
Figure Out the Problem:
Identify the issue with your tax return that led to the notice, such as income discrepancies, large transactions, or missing information.
Reply Promptly:
Respond to the notice by the deadline mentioned to avoid any penalties or further legal issues.
Provide Necessary Documentation:
Include all relevant documents and explanations to clearly address the query or issue raised.
Check Your E-Filing Account:
Verify that the notice is listed in your online account on the Income Tax e-filing portal for authenticity and tracking purposes.
Get Expert Advice:
If you are unsure about the notice or how to deal with it, seek advice from a tax professional.
Documents Required to Reply to an Income Tax Notice
The documents differ depending on the type of income tax notice served to the taxpayer. To respond to an income tax notice, the following basic documents are required, which are common to every notice:
-
A copy of the notice
-
TDS certificates (Form 16- Part A)
-
Proof of Income source (Salary receipts, Form 16- Part B, etc)
-
Investment Proof
What are the Methods of Serving Income Tax Notices?
The Income Tax Act of 1961 specifies various authorized methods for the delivery of Income Tax notices, ensuring clear and legal communication with taxpayers. Notices are personally addressed to individuals, guardians of minors, or key representatives in groups and entities, including:
Direct Mail:
Utilizing registered post for a secure and verifiable delivery to the taxpayer's registered address.
Property Posting:
For unresponsive or unreachable recipients, notices are prominently posted at their known residence or business location.
Group Notices:
Directed to the heads of Hindu Undivided Families (HUFs), partners in firms, or members in associations, ensuring collective responsibility.
Closed Businesses:
Targeting individuals, partners, or directors associated with a business at the time of its closure, to ensure compliance even after operations have ended.
Calling for Information and Scrutiny Notices
Information Requests and Scrutiny Notices, both based on previous tax filings, aim to verify the claims made in your returns.
Section 133(6): Calling for Information
The Income Tax Department uses the power of the Income Tax Act of 1961, including Section 133(6), to collect financial data from third parties such as banks and financial institutions. This aids in gathering critical financial information about taxpayers for a comprehensive tax liability assessment.
Scrutiny Notices:
Sections 142(1) and 143(2) allow the department to directly request specific information from taxpayers, easing the scrutiny process. This process evaluates the accuracy of income and tax payments declared, ranging from limited to complete scrutiny depending on the case's complexity. Adherence to these requests is critical for taxpayers to avoid penalties and validate their tax returns.
PRICING
Appeal Cases
Starting From
₹25,399
*Exclusive of Taxes
SUITED FOR
For 1st & 2nd Appeal
Appeals that can be conducted through online tax portals, without requiring a physical visit
ITAT Appeals will be charged separately, depending upon location & availability of tax consultant
For cases where you cannot proceed with simple Rectification, Revise Return, Feedback
Rectification / Revised / Defective
₹2,499
*Exclusive of Taxes
SUITED FOR
Applicable to rectifying defects, revisions, adjustments, HVT Notice, adjustments, Form 67 defects,26AS-AIS/TIS Mismatch etc.
Major overhauls or replacements beyond basic rectification
If the ITR plan fee is higher than the Notice fee, the higher of the two fees will be applicable
Full payment upfront
We aim to complete the service within 4 business days from the date of receiving the notice with all related documents
This pricing plan covers a two-time rectification / revise / defective service for each eligible customer.
Routine Notice
₹899
*Exclusive of Taxes
SUITED FOR
For providing a simple response and cross checking your filed ITR.
Applicable for Risk Management Notices, Refund Re-issue, Simple Response to outstanding demands, E-Campaign Response etc.
For revise filing due to omission of income or taken incorrect deductions, plan will change accordingly
For Agree/Disagree Responses.
Hear from our clients
Silpa Aswin
Local Guide • 4 days ago
I am happy when I share this because when I downloaded the app I did not think that it would be so fast and transparent. I contacted them in the afternoon and in the evening the process was complete. Share everything in detail and clarify doubt especially thank you to udit jain who was the tax expert to guide me. fully satisfied THANK YOU
S
Google Reviews
5.0
Abhishek Khullodkar
Local Guide • 2 hour ago
Tax buddy is one of the best and most affordable options to file returns. The staff is highly professional and ensures a hassle-free experience. I highly recommend their service. Great job, guys! A special thanks to Mansi Badrike for his awesome assistance today. Keep up the excellent work!"
Google Reviews
5.0
A
Pushpalata Sahoo
2 hour ago
Siddharth is very professional and diligent while understanding the information and concerns as well as possess knowledge to guide. My experience 1st time with Taxbuddy is so great because of professional like Siddharth. Happy to refer and continue the service in future as well.
Google Reviews
5.0
P
Balaaji Dhananjaya
1 hour ago
Great experience. Swift response from the auditors even when having complex taxation issues like foreign tax credit. Special thanks to Suraj, Dipali and Bhavika.
Google Reviews
5.0
B
Kolumagatte pallagatte
2 days ago
Very nice and excellent service by taxbuddy experts. They are having very good knowledge to resolve the issues related to incometax.i recommended many of my coleague s of our Dept. Hats off to taxbuddy. In my notice case for filing rectification for the assesment year 2020-2021 Dipali waghmode madam responded excellently to my phone call as and when got message from ITR CPC section till today responding excellently. I am greatful to her. The fees offered by taxbuddy is also meger. Pl keep it up.
Google Reviews
5.0
K
Our team is ready to assist with all types of Income Tax Notices, from filing appeals with the CIT(A) to representation in higher courts. With our deep tax law expertise, we're committed to securing the best outcomes for you.
Frequently asked questions
Q
What is an Income Tax Notice?
A
An Income Tax Notice is a communication from the Income Tax Department to the taxpayer for various reasons. The reasons may be related to: discrepancies in the ITR filed, requests for additional documents, or requests for taxpayer’s personal appearance. Income Tax Notices can be issued under various Sections of the Income Tax Act, and each Notice specifies the purpose for which it is issued, alongwith the response expected from the taxpayer.
Receiving an Income Tax Notice may not always be a reason to worry. However, it does require an accurate and timely response to address the issue raised by the Income Tax Department.
Q
How do I check my tax notice?
A
An IT notice is delivered to the taxpayer’s registered email. It can also be checked through the income tax notification portal. However, the portal offers information only on some of the notices. For others, you have to visit the IT department. Remember to check the authenticity of the notices by using a quick link for “Authenticate notice/order issued by ITD” on the Income Tax website. At this point, it is also crucial to know your DIN to facilitate communication with the IT department.
Q
Does a salaried person get an income tax notice?
A
Salaried professionals can also get an income tax notice. Most notices come up when there is a mismatch with 26AS/AIS/TIS or any omission of income.
Q
What to do if I get a tax notice?
A
Although an income tax notification can be stressful, you should stay calm and understand why it has been sent. If you have received it for missing out on information, you need to provide the details. Conversely, you will have to rectify errors if they are the reason for getting a notice. You must respond to the notice within the stipulated time to avoid possible penalties.
Q
What happens if you don't respond to the tax notice?
A
Not responding to the income tax notice may have different consequences according to the type of notice. Such consequences include penalties of up to INR 10,000 and imprisonment for up to one year.
Q
What happens if I don't respond to the notice within 30 days?
A
Failing to respond to the notice within 30 days can get you in trouble. The IT department will adjust the outstanding demand without giving you an opportunity to respond.
Q
How do you reply to notice?
A
Replying to an income tax notice is easy as you can do it online by visiting the official website of the income tax department. Log in, navigate to the compliance section, and respond to the notice.
Q
What is an intimation letter from income tax?
A
An intimation order/notice is issued by the income tax department under section 143(1) after the successful processing of your return. It includes the details of the information submitted at the time of tax filing and a corresponding column of the details available with the tax department. This intimation is sent within a year from the end of the financial year.
Q
What does the code EXC 001 mean?
A
EXC -001 means transactions beyond the permission of the IT Act. It is for monthly cash transactions higher than INR 10 lakh.
Q
Do I get notices for current account transactions?
A
Yes, you may get ITR notices for current account transactions. For example, any current bank account transaction exceeding Rs 50 lakhs in a financial year has to be disclosed. If you fail to do it, you may get notice for it.
Q
What is the communication of the proposed adjustment u/s 143(1)(a)?
A
It refers to any information by the IT department regarding adjustment against refund claimed in your income tax return, such as incorrect claim, arithmetical error, or disallowance of loss claimed. Such adjustment could relate to the outstanding demands of previous assessment years.
Q
How can you rectify the discrepancy in u/s 143(1)?
A
If any demand raised in the discrepancy in notice u/s 143(1) is correct, you should pay it. Conversely, you should file rectification u/s 154 (1) or a revised return if a mistake is apparent from the record. For a revision, click ‘e-file’ and choose ‘file income tax return’. For rectification, click ‘services’ and select the ‘rectification’ option from the menu.
Q
How do I pay my tax on demand?
A
Paying online is an easy way to clear your tax on demand. You can do it by accessing the e-filing website of the IT department and logging into your account. Check the amount of outstanding tax demand and pay directly under the "Response to Outstanding Tab" on the web portal.
Q
How do you correct outstanding tax demand?
A
Once again, you can do it by logging in to the official efiling website, going to the pending actions section, and selecting Response to Outstanding Tax Demand.
Q
How long after filing tax returns can you expect an assessment notice?
A
You can get a scrutiny assessment notice u/s 143(2) only up to six months from the end of the financial year.
Q
How do I get my CPC income tax return?
A
You get an ITRV (acknowledgment) on your registered mail ID soon after filing the ITR. You can also download it from your account on the official website.