Income Tax Notice Response
Speed Filings simplifies Income Tax Notice Responses, providing clarity, precision, and expert guidance for seamless compliance.
Comprehensive Income Tax Notice Handling Services by Speed Filings:
Speed Filings, the Income Tax Department issues notices for various reasons, including instances like non-filing of income tax returns, errors in filing returns, or when additional documents or information are required.
Receiving a notice may not be alarming, but it’s essential for taxpayers to comprehend the notice, its nature, the requester’s instructions, and take necessary steps to comply.
At Speed Filings, we provide a comprehensive suite of services for families and businesses, aiding them in maintaining compliance. If you receive an income tax notice, reach out to our Tax Experts at Speed Filings to understand the notice and determine an appropriate course of action.
Let’s explore the different types of notices or intimations issued by the Income Tax Department together.
Varieties of Income Tax Notifications
| Type of Notice | Description |
|---|---|
| Notice u/s 143(1) – Intimation | This commonly received income tax notice addresses errors, incorrect claims, or inconsistencies in a filed income tax return. If revisions are needed, they must be made within 15 days, otherwise, the tax return will be processed with necessary adjustments mentioned in the 143(1) tax notice. |
| Notice u/s 142(1) – Inquiry | This notice is sent to the assessee after the return is filed, requesting additional details and documents to complete the process. It may also be issued to compel the taxpayer to provide supplementary documents and information. |
| Notice u/s 139(1) – Defective Return | Issued if the filed income tax return lacks necessary or contains incorrect information. The taxpayer must rectify the defects within 15 days of receiving this notice under Section 139(1). |
| Notice u/s 143(2) – Scrutiny | If the tax officer is dissatisfied with the submitted documents and information, this notice is issued, indicating selection for detailed scrutiny. Taxpayers under Section 142(2) scrutiny must provide additional information as required by the Income Tax department. |
| Notice u/s 156 – Demand Notice | Issued when the taxpayer owes any outstanding tax, interest, fine, or sum. The notice specifies the amount due and demands payment from the taxpayer. |
| Notice Under Section 245 | Issued when the officer wants to set off the current year’s refund against previous years’ unpaid tax. The recipient must respond within 30 days from receipt, and failure to do so may be considered as consent for assessment. Responding promptly is advisable to avoid automatic consent. |
| Notice Under Section 148 | Issued when there is a belief that income has not been disclosed correctly, leading to lower taxes paid or non-filing of returns. The assessing officer is entitled to assess or reassess the income after serving notice under Section 148. The assessee must furnish the return of income, and responding to this notice is crucial to comply with assessment or reassessment procedures. |
Service of Income Tax Notice by Speed Filings
The Income Tax Act, 1961, governs the service of notices, summons, orders, or any communication, with delivery or transmission being carried out through methods sanctioned under the Act. Here are the diverse ways in which Speed Filings handles the service of Income Tax Notices.
Recipient of the Notice:
Income Tax Notices are directly addressed to individuals. In cases involving minors, notices are addressed to their guardians. Rectifying an incorrect description of the assessee is usually possible, but when the status is intertwined with identity, the name on the return becomes crucial.
Service by Post:
Service of income tax notices can be facilitated through registered post. Section 27 of the General Clauses Act 1897 specifies the process involves properly addressing, pre-paying, and posting a registered letter containing the document. This can be delivered to the address, an employee, agent, or any other authorized person.
Service by Affixture:
When a defendant refuses acknowledgment or is not locatable, the office may affix a copy of the notice on the outer door or another noticeable part of the residence or business premises.
HUFs and Partnership Firm:
For a partitioned HUF, notices can be served on the person who was the manager. In the case of a deceased individual, the notice goes to all adults associated. For firms or associations, notices may be served on former partners or members.
Closed Business:
In the event of a closed business, the assessing officer serves notice on the individual subject to assessment. For firms or associations, it is sent to any member during discontinuation, and for companies, it goes to the principal officer or director.
Documents Required to Reply to an Income Tax Notice
The necessary documents to respond to an income tax notice vary based on the type of notice. However, basic documents include:
- Income Tax Notice copy.
- Proof of income sources (Part B of Form 16, salary receipts, etc.).
- TDS certificates, Form 16 (Part A).
- Investment proof (if applicable).
Checklist for Income Tax Notice
Step 1: Respond to the intimation notice under Section 143(1) within 30 days of receipt.
Step 2: Failure to respond within the prescribed time will result in the processing of Income Tax Returns with necessary adjustments, without providing opportunities to taxpayers.
Step 3: Check the name, address, and PAN number mentioned in the notice.
Step 4: Verify the assessment year mentioned and cross-check the e-filing acknowledgment number.
Step 5: Revised returns can be filed within 15 days if mistakes are found in the original filing.
Step 6: Rectification returns can be filed if faults or errors in the order are identified.
Step 7: On Page 2 of the notice, understand the reason for issuance and compare the mentioned income with Form 16/16A/26AS.
Step 8: If the notice demands additional tax (demand notice), treat it as a notice of demand under Section 156.
Step 9: Respond within 30 days of receiving a demand notice to avoid interest and penalties imposed by the assessing officer.