As soon as the ITR filing process begins, taxpayers rush to file their returns. However, filing an ITR based solely on salary slips and Form 16 can be inaccurate. This could result in financial losses.

According to tax experts, a large number of people make mistakes in their ITR-1 and ITR-2 every year. This could result in future notices, refunds, or penalties. Therefore, avoid mistakes like submitting the wrong ITR form, providing incomplete income information, or not completing e-verification right away. Also, understand the difference between ITR-1 and ITR-2 clearly. Otherwise, you could face financial losses in the future.

What is the difference between ITR-1 and ITR-2?

ITR-1 is for individuals with income up to ₹50 lakh. Furthermore, ITR-1 is for individuals with income from salary, pension, property, or interest on two houses. Under the new rules, individuals with long-term capital gains of up to ₹1.25 lakh under Section 112A can also file ITR-1, subject to certain conditions.

Therefore, if you have foreign assets, foreign income, multiple houses, large positions in a company, unlisted shares or capital gains in the stock market, it is necessary to file ITR-2.

What mistakes should you avoid when filing your ITR?
The most important thing is to avoid choosing the wrong form. Also, carefully check the information provided in the AIS, TIS, and Form 26AS. Don't overlook this. If the information provided in these forms and the details in your ITR don't match, the Income Tax Department may ask for clarification.

PC: SaamTV