The Income Tax Department may issue a notice for non-filing an ITR if you have filed an Income Tax Return for one year and have not filed the following year, or if you have completed high-value transactions without completing an ITR (Income Tax Return). These notifications can be made for a number of reasons, including asking for further information, addressing inconsistencies in a tax return, starting an audit, requesting un-paid tax, or giving information about tax refund’s. Specific information about the department's requirements, such as providing supporting documentation or providing an explanation of income and claimed deduction’s, is outlined in each income taxation notice.

Reasons for Getting a Notice on Income Tax

1. Failure to file tax returns: If you fail to file your income tax return by the deadline, you may receive a reminder to do so as soon as possible.

2. High-Value Transactions: The department may send you a notice requesting an explanation if you have engaged in high-value transactions that don't match your reported income.

3. TDS/TCS Mismatch: A notification may be issued if there is a difference between the income reported on your return and the tax deducted at source (TDS) or tax collected at source (TCS) as stated on your Form 26AS.

4. Tax Demand: You can get a notification requesting payment of the overdue tax if the department determines that you own money based on your return or revisions.

5. Refund Claims: Prior to the refund being processed, you may receive a notice for verification if you have requested a refund in your return.

6. Foreign Assets or Income: If more information is required or inconsistencies are discovered in the given details, having foreign assets or income may result in a notice.

Respond to the income tax portal's notice

Step 1: Go to the Income Tax Electronic Filing Portal

Step 2: Access your account and log in. Making use of your PAN card, click "Continue."

Step 3: Check your account for any notifications by selecting the 'e-File' menu.

Step 4: Clicking "Provide" allows you to see comprehensive notices and replies.

Step 5: When responding to tax demands, the assessee must then select one of the options listed below.

Step 6: Send it in, and then frequently check to see if any fresh follow-up alerts have been sent out requesting more details.

1. Prevents fines and penalties

Have you avoided fines and late fees?

You lessen the possibility of further tax requests.

2. Fixes Mistakes in Tax Documents

Inconsistency in the income information

TDS discrepancy

False deductions were made, and the right documents were provided in response.

3. Lessens Tension and Potential Criticism

Set off further examination

cause recurring problems with compliance

4. PRevents Legal Action

Put bank accounts on hold.

Refunds should be adjusted for outstanding demands.

Commence the healing process

1. Notice under Section 143(1)—Information

Income tax notices are among the most often received. It is given to draw attention to mistakes, false statements, or discrepancies in an income tax return that has been filed. After getting this letter, taxpayers have 15 days to amend their return.

2. Notification under § 142(1): Inquiry

Even after a return has been submitted, this notification is sent out whenever more information or supporting documentation is needed to finish the assessment process.

3. Take note of Section 139(1): Defective Return

A notice under Section 139(1) is sent when an income tax return is lodged with inaccurate or missing information.

4. Take note of u/s 143(2): Examining

If the assessing officer is dissatisfied with the information and documentation the taxpayer has submitted, an income tax notice under Section 143(2) is issued.

5.Notice u/s 156-Demand

When the Income Tax Department finds that the taxpayer is in arrears on taxes, interest, fines, or other obligations, this letter is sent. The notice details the amount owed and demands prompt payment to prevent penalties.

6. Notice u/s 245-Refund or Adjustment

If the department thinks that tax obligations from prior years can be deducted from a current year's refund, a notice under Section 245 is delivered. This notice must be answered by the taxpayer within 30 days.

7. Notice u/n 148- Income Escaping Evaluation

This notification is given if the assessing officer has grounds to suspect that income has not been accurately stated, leading to lesser taxes, or if a required return has not been filed.

Step 1: Carefully read the notice

Verify the section number (for instance, 139(9), 143(1), 142(1), etc.).

Year of Assessment (AY)

Deadline for responses

Verify the notice's reason.

Note: Different kinds of responses are needed for different sections.

Step 2: Documents Needed

Obtain supporting documentation, including

Form 16/16A

Statements from banks

Proofs of investment

TDS certificates as evidence of investment

An earlier copy of the ITR

Pay stubs

Statements of capital gains

Step 3: Access the Income Tax Portal and go to "Pending Actions".

Step 4: Pick the Correct Answer Choice

Step 5: Provide Supplementary Files

Step 6: Download the Acknowledgement

Step 7: Send in your response

Step 8: Monitor the Situation

1. Income Tax Notice copy

2. TDS certification, Form 16 (Part A)

3. Proof of Income source such as(Part B)

4. Investment Proof if they are applicable.

5. To verify transactions or income entries

6. Form 26AS/AIS (Annual Information statement)

7. ITR Acknowledgement/ Computation Sheet

8. For the relevant assessment year

9. Any Other Supporting Documents

We at Tax Esquire offer professional support to enable you to effectively reply to income tax notifications. Our knowledgeable tax professionals provide tailored advice to assist you in navigating the intricacies of your notice. To make sure you completely understand what is required, we begin by examining the notice's requirements and specifics. In order to provide a comprehensive and correct response, our staff also helps to discover and gather the relevant documentation. We draft accurate and prompt responses to the Income Tax Department's enquiries, guaranteeing adherence to tax regulations to reduce the possibility of additional enquiries or fines. You may manage your income tax notice with confidence and continue to be in accordance with the law if you have our professional assistance.