Return Compliance

Return Compliance


The Income Tax department is sending this letter to people who have not e-Filed or have not disclosed all incomes according to their records.In short, the Income Tax Department wants you to explain why you haven’t e-Filed your return and may additionally ask you to explain some facts regarding your income. This article talks about Compliance Income Tax Return filing Notice received from Income Tax Department,how Income Tax Departments gets information,How to reply to Compliance notice of Income Tax.

The Income Tax Department sends the Compliance Notice to people who have not e-Filed their income tax return or have not disclosed all incomes according to their records. So it wants to ask why have you not filed your return or explain the discrepancy between your earnings and spendings, or ask you to explain your sources of income. Note that ITR is a way to legitimise your financial standing and maintain a healthy financial transaction.
This is with the help of improved monitoring due to stricter know-your-customer norms and online filing of returns, both of which have made data processing easier and faster with which escape can be easily monitored.

According to the Income Tax Act, you’re required to file a Income Tax Return, if your taxable income exceeds basic exemption in a financial year i.e Your gross total income (before allowing any deductions under section 80C to 80U) exceeds Rs .2,50,000 in the financial year that begins on 1st April 2014 and ends on 31st March 2015. This limit is Rs 3,00,000 for senior citizens ( who are more than 60 years old but less than 80 years old) or Rs 5,00,000 for super senior citizens (who are more than 80 years old). Many salaried people assume that as employer, has deducted TDS then they do not have to file Income returns. Even if TDS is deducted by employer you still need to file ITR.

The high value transactions is closely scrutinized by tax department for the individuals. For example in a year cash deposited Rs. 10 Lakh or more, or in a year purchase of debentures and bonds worth 5 Lakh or more, Rs 30 lakh or more purchase or sale property etc. To explain the source of income the income tax departments sends you a notice .