Don’t Let AIS Discrepancies Derail Your ITR: Fix Them Now to Avoid Penalties!
Taxpayers, listen up! As you prepare to file your Income Tax Return (ITR) for Assessment Year 2025-26, a crucial step often overlooked is reviewing your Annual Information Statement (AIS). Ignoring errors or mismatches in your AIS can lead to unwelcome income tax notices and hefty penalties. The good news? The Income Tax Department has a clear process for you to correct these discrepancies before they become a problem.
Why Your AIS Matters (and Why it’s More Than Just Form 26AS)
Your AIS is a comprehensive record of your financial activities related to tax, accessible on the Income Tax Department’s e-filing portal. It’s far more detailed than Form 26AS, capturing everything from interest income and dividends to stock transactions, property dealings, and even GST turnover. This holistic view is designed to help you cross-verify your financial data and ensure all income sources are accurately reported.
The Perils of Uncorrected Mismatches
Leaving AIS discrepancies unaddressed is a recipe for trouble. Imagine your reported income is ₹25 lakh, but your AIS shows investments of ₹40 lakh. This kind of mismatch is a red flag for the tax department, likely triggering a notice demanding an explanation. Fail to justify such discrepancies, and you could face severe consequences:
- Penalties under Section 270A: For under-reporting or misreporting income.
- Interest Charges under Sections 234B and 234C: For defaults or deferments in advance tax payments.
Your Action Plan: How to Correct AIS Errors
The Income Tax Department emphasizes the importance of your feedback. As of July 16, 2025, they reiterated, “Taxpayers can provide feedback on each transaction in the AIS,” and “Any disputed transaction is taken up with the reporting source for confirmation.” Here’s how to correct errors:
- Access Your AIS: Log in to the Income Tax Department’s e-filing portal (incometax.gov.in).
- Locate the Discrepancy: Find the specific transaction in your AIS that has incorrect data.
- Submit Feedback: Choose “Optional” or “Add Feedback” for that transaction.
- Provide Correction: Select the appropriate feedback option to submit your correction.
- Monitor Status: Keep an eye on the feedback status. It will show as “Accepted” or “Rejected,” ensuring your corrections are processed.
By actively engaging with this system, you ensure your records are accurate, significantly reducing the risk of audits or penalties.
In essence, a thorough review of your AIS before filing your ITR is not just a recommendation—it’s a necessity. Address any discrepancies promptly to maintain a clean financial record, ensure a smooth filing process, and safeguard yourself against future legal and financial complications.