The Central Board of Direct Taxes (CBDT) has announced that it will send notices to some taxpayers who have not filed their income tax returns (ITRs) despite having tax deducted at source (TDS) on their incomes. According to CBDT chairman Nitin Gupta, there are about 15 million such taxpayers in India. The department will send notices to only a few thousand of them for which it has definitive information.
The CBDT is using the vast amount of data it receives from various sources to detect mismatches and inconsistencies in the tax filings of the taxpayers. It is also reaching out to the taxpayers to update their returns in case they have missed out on any details or made any errors. The department has collected Rs 4,600 crore so far from 5.1 million updated returns.
The CBDT is also focusing on improving the taxpayer services, such as reducing the refund time and resolving large tax disputes. It has set up a demand management centre in Mysuru, Karnataka, that is dealing with tax disputes above Rs 1 crore. The centre is bringing together the chartered accountants, the assessing officials and the taxpayers to reach an agreement on the assessments.
The CBDT will also issue a detailed circular to implement the budget announcement of withdrawing the outstanding small tax demands of up to Rs 25,000 up to FY15. The department will reach out to the taxpayers and they do not have to do anything for this.
If you are one of the taxpayers who have not filed your ITRs despite having TDS on your income, you may receive a notice from the CBDT soon. You should file your ITRs as soon as possible and update your details if required. You should also check your tax credit statement (Form 26AS) to verify the TDS deducted and deposited by your employer or other deductors. You should also claim any deductions or exemptions that you are eligible for.
Filing your ITRs on time will help you avoid any penalties, interest or prosecution by the tax department. It will also help you claim any refunds due to you and carry forward any losses that you may have incurred. Filing your ITRs is not only a legal obligation but also a social responsibility.