As soon as the portal for filing Income Tax Return (ITR) opens, all taxpayers want to file returns as soon as possible. Nobody likes to wait for a long time. If you are also one of those who pay tax as soon as the portal opens, then this news is for you. Know what the right time and way to file taxes is. Is it right to hurry, or would it be better to wait a bit? Let’s understand.
Why hurry in filling the ITR can be costly
Whenever the portal for filing ITR opens, it is important to wait for some important information to be updated before filling it. Experts say that taxpayers should wait till June 15. Because banks, employers, and other entities have time till May 31 to update the information of financial transactions, tax deduction at source (TDS), and tax collection at source (TCS). After this, it may take another 7 to 10 days for this information to be updated in the Annual Information Statement (AIS) and Form 26AS. So, being hasty can cost you some money.
What can happen if you file an ITR early
If taxpayers file ITR before AIS and Form 26AS are fully updated, there can be a gap in the information. For example, suppose an employee’s employer deducts TDS of ₹10,000 every month. By March 2025, this amount becomes ₹1.2 lakh. But if the employer does not update the TDS for the January-March quarter by May 31, only ₹90,000 TDS will appear in the Income Tax Department’s system. The taxpayer can claim TDS of ₹1.2 lakh based on his salary slip, which will cause a gap in the data. This gap can get you a notice from the Income Tax Department.
In such a situation, two types of problems can arise
First, if the taxpayer provides the information of TDS and income for the entire year, but it is not updated in AIS/26AS, then a notice may come. In this case, the taxpayer can file a correction to reprocess the return.
Second, if the taxpayer files data for only nine months, then the difference in income or TDS will be visible when AIS and 26AS are updated! In such a situation, the revised return has to be filed by December 31. If this deadline is missed, then an updated return may have to be filed with additional tax and interest.
What to do now
Experts believe that taxpayers should wait for AIS and Form 26AS to be fully updated. Employers usually issue Form 16 by June 15, which contains complete information about salary and TDS. In the meantime, taxpayers can collect their financial information and match it when AIS is updated.
If there is any error in the AIS, taxpayers can request correction through the portal. Taxpayers who have income only from fixed deposits or rent and no TDS has been deducted can file returns early. However, in cases involving TDS or TCS, it is important to disclose the full amount.
Tax experts say avoid rushing into filing ITR. Waiting until the Statement of Financial Transactions (SFT), AIS, and 26AS are updated reduces the chances of errors and notices. Filing returns with accurate information at the right time is the safest way to go.