'Other Exemptions' Under Scanner

The checking of such claims has already occurred before, still, officials are saying that this year’s effort is more focused and serious. Because there are numerous suspicious cases, the department is now thinking about amending the format and structure of income tax return (ITR) forms to make them stronger and more secure, so that people can’t easily give wrong or misleading information.

One of the senior officials said, “Some taxpayers are misusing the ‘Other’ exemptions column to inflate deductions, assuming their returns won’t come under the taxman’s radar. However, the department is now closely analysing these entries.”

Notices Go Beyond Random Scrutiny

These notices are different from the usual checks that happen every year at random. This time, the notices were created using advanced computer tools that spot unusual or overstated claims.

Many of the indicated cases involve private company employees. In some of these, people tried to lower their taxable income by giving false or unsupported claims.

Revised or Updated Returns Required

Taxpayers who have sent the notices are required to update their return if they are still under the time deadline or file revised returns by paying the additional tax liability, in addition to the interest.

Individuals who have exceeded the time deadline for filing updates. The only option is a revised return under Section 139(8A).

Misuse of Tax Exemptions Carries Consequences

Experts say that even though taxpayers might think these claims are just an easy way to save money, the rules about tax deductions are clearly set. Trying to go around these rules can lead to fines or even legal action in some cases.

The sources say, “This drive sends a clear signal: No exemption, however small, will be overlooked if claimed without basis. It’s not about the quantum, but about compliance and integrity in tax filings.”

What Things Taxpayers Should Know

• All the claimed deductions must be attached with all relevant documents.
• Don’t overemphasise amounts under the ‘Other’ exemptions section.
• Keep a note of Mediclaim policies, education loan interest payments, and employer reimbursements.
• Submit corrected or updated tax returns quickly if you get a notice.

There is less room for error or manipulation in ITR submissions as the income tax administration improves its data analytics and examination tools. To minimise regulatory annoyances, taxpayers are encouraged to take a cautious and compliant approach.