New tax rules make false claims risky. Over 90,000 caught. Now detailed proof is required or face 200% penalty, interest, and even jail.
Anisha Kumari | Jun 5, 2025 |
New ITR Filing Rules: Big Trouble Ahead for Fake Claims
During an Income Tax investigation, a big number of people have been caught lying on their tax returns. More than 90,000 salaried individuals claimed fake tax deductions. This resulted in over Rs. 1,070 loss of government. Income Tax Department has now made the rules much stricter to stop such things from happening again.
Now people have to give full details to prove their deductions while filing income tax returns using forms like ITR-1 or ITR-4. If someone wants to show investments under Section 80C like LIC, PPF, or ELSS then they are required to give the policy number or a valid document ID. Only writing a lump sum amount without proof won’t work anymore.
Now it is compulsory to give the name of the insurance company and the policy number if someone is claiming health insurance under Section 80D. This step will stop people from giving false or unclear information.
A person should give complete details if he/she wants tax benefits on loans like education loans or home loans under Sections 80E, 80EE or 80EEA. It includes the name of the lender, the loan account number and the date when the loan was approved.
Those who bought electric vehicles and want tax savings under Section 80EEB even they are required to provide the vehicle’s registration number. These steps have been added to make sure everything is properly checked.
The department has started using a tool called the Annual Information Statement (AIS). It helps to match the information given in the tax return with real records through banks and other sources which makes it easier to find out if someone is lying.
A penalty of up to 200% of the tax will be charged if someone tries to give wrong information in their tax return. There can be 24% interest also charged on the unpaid tax. And if the case is serious the person could even face legal trouble or jail time.
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