Section 80P Notice: Income tax department issues clarification on notices for Section 80P deductions


Section 80P Notice: The Income Tax Department had recently sent tax notices to many taxpayers under Section 80P of the Income Tax Act, on which reports were coming that these notices had been sent by mistake. Now clarification has also come from the tax department on this. Know what is the whole matter, and what is this section, know.

What is the whole matter?

These notices were sent to many taxpayers for wrongly claiming tax deduction under section 80P. Taxpayer Chartered Accountant Nirav Choksi had asked a question regarding this on X. Choksi had tweeted on September 1 that “Faulty returns are being reported in partnership firms. The mentioned section 80P is not applicable to firms.

” In response, the Income Tax Department said: “Information under section 143(1) of the Income Tax Act, 1961, along with error details ‘Claim of deduction under section 80P(2)(e) on income other than rental income’ in Schedule 80P “Can’t be done” has been sent inadvertently. An email communication in this regard will be sent to you soon. Sorry for the inconvenience caused.”

What was in the tax notice?

Last week, hundreds of taxpayers contacted their tax consultants after being sent these notices, which were sent to them even when they had e-verified their returns (ITR e-verification) and the deadline was August 31. had ended. These notices are related to claiming tax deductions for which they are not even eligible. The problem here was that these deductions were not for individuals, but for cooperative societies. Due to some technical glitch, this notice went to the taxpayers.

The department says that it is rectifying the mistake and those who have received the notice by mistake will not have to pay any penalty. Also, those taxpayers who have deposited tax on the basis of this notice, their money will also be refunded.

What is Section 80P?

‘C’ of Chapter-4 of Income Tax Act, 1961. – Under ‘Deductions in respect of certain incomes’, taxpayers get deduction in different income categories. There is one section in it – 80P. This deduction is available on the income or profit earned from the co-operative society. Individuals, Hindu Undivided Families, companies and firms can claim deduction under this. Deduction can be claimed on the actual profit earned by the assessee from certain specific activities of any co-operative society. The profit is kept within the scope of deduction only if it is included in the gross total income of that co-operative society. .

Taxpayers should keep these things in mind

The Income Tax Department has given clarification regarding these notices, but it is important for the taxpayers to know that the only taxpayers who will receive notice under this are those who have filed their income tax return in the assessment year 2023-24. This clarification was not available for taxpayers who have claimed deduction while filing returns for other assessment years. If any taxpayer has confusion regarding any notice, then he can find out on the helpline of the Income Tax Department.