Why You Should Not File Your ITR Too Early: Know The Consequences:

Why You Should Not File Your ITR Too Early: Know The Consequences Many individuals prefer to file their Income Tax Return (ITR) early to stay ahead. However, many tax experts suggest not to rush into filing ITR. It is advised to wait till the Form 26AS and Annual Information Statement (AIS) are completely updated. Filing your ITR too soon can lead to serious problems.

Consequences of Filing ITR Early

If you file ITR before Form 26AS and AIS (Annual Information Statement) are updated, you might face serious issues, as Form 26AS and AIS take around one week to show the update after the TDS and SFT (Statement of Financial Transactions) filing deadline of May 31. Here are the risks when you file your ITR before these updates.

• Your ITR may show a mismatched TDS or income.
• In such a case, you might receive an Income Tax notice issued by the Income Tax department.
• If the TDS claim had not been provided, you may need to file a revised return.
• And, if you update your ITR after December 31, you might end up paying higher taxes along with interest and penalty.

What Should Taxpayers Do?

• Taxpayers should wait until Form 26AS and AIS are updated; usually, these are updated by June 15.
• You can use this time to collect and verify your financial data.
• Match your records with AIS to ensure accuracy.
• File a revised return before December 31 to avoid higher penalties.