ITR Mistakes FY 2025-26: 15 Common Errors to Avoid

Filing with the wrong ITR form can make your return defective and trigger tax notices or assessment adjustments. Each ITR form is designed for specific types of taxpayers (e.g., salary income, business/professional income, capital gains); using an incorrect form may lead the Income Tax Department to reject the return or ask for rectification, delaying refunds and causing additional scrutiny. If you realise the mistake, you should rectify by filing a revised return within the prescribed time or respond to the notice with correct information; persistent errors can also attract penalties. Always check eligibility criteria for ITR-1, ITR-2, ITR-3, ITR-4 etc., before submitting your return for AY 2026-27.

Yes, quoting the wrong assessment year (AY) when filing your ITR for FY 2025-26 will lead to processing errors and potential notice from the tax department. The AY must be 2026-27 for income earned in FY 2025-26; a mismatch can result in the return being considered invalid, delayed refunds, or mismatches in tax credits. If discovered, you should file the correct return for AY 2026-27 or respond to the department’s notice promptly to avoid penalties or interest on unpaid tax. Always verify the AY before submission to ensure proper credit of TDS and refunds.

Providing incorrect personal information (name, PAN, Aadhaar, address, or bank account) can lead to rejection of the return, tax notices, or failure to receive refunds for AY 2026-27. PAN and Aadhaar mismatches can prevent e-verification and processing; incorrect bank details will delay or prevent direct credit of refunds. Minor errors should be corrected immediately by filing a revised return or following the rectification process after receiving a notice; consistent inaccuracies may attract scrutiny and administrative hassles. Always cross-check PAN, Aadhaar, bank IFSC/account numbers and contact details before filing.

Yes, you must disclose all income sources (salary, interest, rent, capital gains, business income, foreign income) in your ITR for FY 2025-26, otherwise you risk notices, penalties, or reassessment. Undisclosed income uncovered later can lead to tax demand plus interest and possible penalties; even small incomes like bank interest and freelancing should be reported. Use Form 26AS, AIS and TIS to reconcile TDS and third-party reporting and ensure nothing is omitted; if you missed an income earlier, file a revised return as needed to correct the record. Accurate disclosure also speeds up refund processing and reduces chances of tax scrutiny.

Reconciling your income and TDS with Form 26AS is critical because mismatches between your ITR and 26AS often trigger tax notices and delayed refunds. Form 26AS shows TDS/TCS, advance tax and self-assessment tax credits reported against your PAN; failing to include these amounts in the return or ignoring differences can lead to demand notices or incorrect tax calculations. Review and correct discrepancies by contacting deductors for corrections, include missing TDS in your ITR, or file a revised return if necessary; do this before e-verifying to avoid post-filing complications. Regularly check 26AS while preparing your AY 2026-27 return to ensure all tax credits are claimed.

AIS (Annual Information Statement) and TIS (Taxpayer Information Summary) are consolidated information reports from the tax department that contain third-party data like high-value transactions and TDS, and reconciling them with your ITR prevents mismatches and notices. These reports may include income, investments, property transactions or bank transaction summaries that the department expects you to declare; failing to reconcile can lead to queries or reassessment. Compare AIS/TIS entries with your books and ITR, and explain or correct differences by filing a revised return or submitting clarifications when required. Regular reconciliation helps detect omitted incomes (e.g., capital gains from mutual funds or sale of property) before the department raises objections.

If you have Form 16 from two or more employers in FY 2025-26, you must combine salary details and TDS from all employers in a single ITR for AY 2026-27 to avoid underreporting or refund issues. Summarise gross salary, exemptions (like HRA), and tax deducted from each Form 16, and ensure total TDS matches Form 26AS; failing to consolidate can create perceived shortfall and notices. If both employers issued Form 16 for overlapping periods, reconcile the employment dates and earned amounts before filing; keep supporting documents like relieving letters and pay slips in case of queries. Correct aggregation prevents defective returns and speeds up processing of any refunds.

If your employer didn't give HRA but you paid rent, you can still claim House Rent Allowance exemption in your ITR by declaring rent paid and providing supporting documents, but you cannot claim HRA deduction if it was not part of your salary structure; instead you may claim deduction under Section 80GG if eligible. For AY 2026-27, maintain rent receipts, lease agreement and PAN of landlord (if required) and accurately compute exemption using salary components, city of residence and actual rent paid. If HRA was paid but not reflected in Form 16, get the employer to correct Form 16 or declare the amount correctly in your ITR; incorrect HRA reporting can trigger notices or disallowance.

Not paying advance tax when applicable can result in interest under Sections 234B and 234C and a higher tax liability at the time of filing your ITR for AY 2026-27. Taxpayers with tax liability after TDS exceeding Rs 10,000 in a year must pay advance tax in instalments; missing installments attracts interest for deferred payment. To avoid interest, estimate your tax liability accurately during the year, pay advance tax by due dates, and keep challans/receipts; you can still pay remaining tax before filing but will be liable for interest on delayed instalments. Self-employed taxpayers and those with significant non-salary income should be especially vigilant about advance tax compliance.

E-verifying your ITR within 30 days of filing is essential because an unverified return is treated as not filed and may be processed as a defective return, leading to notices or loss of refund for AY 2026-27. E-verification methods include Aadhaar OTP, net banking, EVC via bank account or demat, or sending a signed physical ITR-V to CPC within the timeline; failure to complete e-verification will result in the return being invalid after the allowed window. If you miss e-verification, you can file a fresh return before the due date or respond to notices as applicable, but timely e-verification ensures quicker processing and avoids legal complications.

Yes, taxpayers holding foreign assets or financial interests must disclose them and complete Schedule AL (Assets and Liabilities) in their ITR for AY 2026-27, otherwise they risk penalties, notices and possible prosecution under the Income Tax Act. Schedule AL requires reporting of foreign bank accounts, financial interests, immovable property abroad and other overseas assets along with corresponding liabilities if the total value exceeds specified thresholds; non-disclosure can lead to severe consequences including search and seizure or penal provisions. Even if tax is not due on those assets in India, full disclosure provides transparency and prevents future disputes; consult a tax advisor for valuation and reporting rules if you hold significant foreign holdings.