The Income Tax Department may ask you questions about your family expenses, including your monthly ration expenses

Jyoti — Mon, 10 Mar 2025 13:28:49 +0000

Income Tax Department: Recently, an income tax notice was circulating on WhatsApp. In this, an income tax officer was asking a taxpayer for a break-up of household expenses. There was a lot of discussion on social media about this. Let us know what income tax has to do with a taxpayer’s household expenses and why the officer asked questions about the expenses.

Income tax officer looks at the source of income

When the Income Tax Department selects an income tax return for scrutiny, the officers look at the income shown in the income tax return and the source of income of the taxpayer. Then what is the reason for asking questions about the personal expenses of a taxpayer? The answer is that every person has to make some necessary expenses for himself and his family members. These include expenses on ration, insurance, expenses on social functions, hair cutting expenses, expenses on eating in restaurants, etc.

Mismatch between taxpayer’s income and expenses

Such expenses depend on the status of the person and some other things. These include education, number of family members, marital status and the area where the person lives. Based on all these things, a person spends a certain amount on his personal needs. However, many people file their income tax returns without paying attention to these things. If a person does not withdraw enough money from the bank for his expenses, it raises suspicion.

A person’s expenses may be more than his income

This raises doubts whether the person’s income is from an undeclared source, which is used for personal expenses. If a person receives such a notice and he has used his bank account or credit card for family expenses, then he can inform the Income Tax Officer about this. This ends the matter. If this expenditure is made by a close relative, then also he can inform the Income Tax Officer about this. He will have to give details of the relative’s income.

Penalty may be imposed for not disclosing the source of income

If a person does not properly tell the income tax officer about his expenses, then it will be assumed that he has some undeclared income and then a penalty will be imposed. If the taxpayer feels that the calculation of the income tax officer is not correct, then he has the right to appeal.

(The author is a chartered accountant. He is an expert in personal finance, especially matters related to income tax.)

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ITR Big News : What will happen if you fill the wrong ITR form, will you get a chance to rectify the mistake?

Pravesh Maurya — Fri, 29 Jul 2022 03:54:35 +0000

ITR Filing News: The Income Tax Department issues a total of 7 types of form issues. Out of this, only 4 forms are for individual income tax payers.

If you have filled any wrong form then you can get notice from Income Tax Officer. The last date for filing ITR for the year 2022-23 under review is 31 July 2022. You can be fined for filing tax returns after this date. By the way, usually the income tax payers know which ITR form they have to fill, but many times if a wrong form is filed accidentally or unknowingly, then what should be done in such a situation.

Income Tax Department issues a total of 7 ITR forms. Of these, ITR-1, 2, 3 and 4 are for individual taxpayers only. If the income tax payer fills the wrong form then he may face problems. Income Tax The Income Tax Officer can declare your return as defective under section 139(9) of the Act.

What happens after ITR is declared defective?

If the Income Tax Officer declares your return defective, he can send you a notice. You have to file the revised return through the correct form within 15 days from the date of receipt of the notice. If you fail to do so, then your ITR will be considered invalid and you will have to pay a penalty for filing the return after that.

4 types of forms

If your total income in the last financial year is Rs 50 lakh, then you have to fill ITR-1 form. This income can be received from other sources including your salary, interest from bank deposits and pension. After this there is ITR Form-2. The details of capital gains, foreign income, income from property or income earned on becoming a director of the company have to be given in this form. Form-3 is for those people who not only get income from the methods mentioned in Form-2, but also get income from any other business and profession. ITR-4 form is for Individuals, HUF and Firms having income up to Rs 50 lakh. Apart from this, they also get income from other business and profession.

What are the other 3 forms

ITR-5 is for partnership companies, business trusts, investment funds. At the same time, ITR-6 is for those companies which are registered under section 11. The IT-7 form is for organizations such as charitable trusts, political parties, research organizations or news agencies.