ITR Filing: Don’t Miss These 8 Critical Disclosures!
Filing your Income Tax Return (ITR) can be a complex process, and missing even a single detail can have serious consequences. According to tax expert Sujit Bangar, founder of TaxBuddy.com, non-disclosure can lead to your return being marked as “defective,” potentially triggering penalties of up to ₹10 lakh or even jail time.
Here are the eight crucial disclosures you must get right:
- Foreign Assets & Income: Got an overseas bank account, securities, or insurance? You must disclose them all. Failing to do so could result in a ₹10 lakh penalty and imprisonment. Additionally, you need to provide a detailed, country-by-country report of all foreign-sourced income on Schedule FSI.
- Virtual Digital Assets (VDA): Every crypto or NFT transaction must be reported on Schedule VDA. You’ll need to provide details like acquisition/sale dates, value, and cost. Remember, losses from VDA cannot be offset against other income.
- Unlisted Equity Shares: If you held unlisted shares at any point during the year, you must disclose all transactional data.
- Directorships: If you were a director in any company, be sure to report your DIN, the company’s PAN, and your shareholding status.
- Assets & Liabilities (Schedule AL): If your income is over ₹1 crore, you’re required to report your assets (like property, jewelry, and stocks) and liabilities on Schedule AL.
- Partner in a Firm: Partners must ensure their disclosures are consistent with their firm’s ITR-5 filings.
- Bank Details: Make sure your bank account is pre-validated to receive any refunds.
- E-verification: Your return isn’t complete until it’s e-verified within 30 days of filing.
Why is this so important?
Incorrect or missing information can make your return “defective” under Section 139(9) of the Income Tax Act. Double-check all entries and ensure consistency across all schedules to avoid legal trouble and financial penalties.