What is Respond to Tax Notice Overview
Once you submit the Income Tax Returns, the next and the final step of the e-filing process is verification. The Income Tax Department (IT Department) checks the income declarations and tax paid to see if all these details match. Only then the IT Department will accept the tax return filed as per Section 143(1).
If the taxes paid are found to be less than what you owe, they will issue you a demand notice.
Process for Respond to Tax Notice
01
Step 1
The income tax department performs a preliminary review of all returns submitted and informs taxpayers of the results of such preliminary assessment
02
Step 2
This evaluation includes mainly mathematical mistakes, internal contradictions, tax estimation, and tax payment verification
03
Step 3
Under Section 143(1), such communication to the taxpayer regarding the preliminary assessment is called an intimation
04
Step 4
The preliminary assessment is done by the Central Processing Unit (CPU), which is completely computerized and it doesn’t involve human intervention
05
Step 5
Once the return is filed by the taxpayer, the total income or loss will be computed by the computerized system and provides a comparison of the evaluation process
06
Step 6
The intimation notice under section 143(1) consists of two columns namely
07
Step 7
As provided by the taxpayer in the return of the income
08
Step 8
As computed under section 143(1)
Here, this two-column shows the calculation done by both the taxpayer and IT department computing the total income and liabilities. And eventually, it shows who was liable
Documents Required For Respond to Tax Notice
- Interest certificates from banks, post offices, etc
- Form 16/ 16A / 26AS
- Any tax saving investment proof
- Rent receipts
- Proof of Deduction made under 80C
- Documentary proofs to claim deductions under section 80D
- Home loan statement from the bank and NBFC
- Capital gains
- Salary slips
- Bank account details, etc
Benefits Of Respond to Tax Notice
- The income tax department performs a preliminary review of all returns submitted and informs taxpayers of the results of such preliminary assessment
- This evaluation includes mainly mathematical mistakes, internal contradictions, tax estimation, and tax payment verification
- Under Section 143(1), such communication to the taxpayer regarding the preliminary assessment is called an intimation
- The preliminary assessment is done by the Central Processing Unit (CPU), which is completely computerized and it doesn’t involve human intervention
- Once the return is filed by the taxpayer, the total income or loss will be computed by the computerized system and provides a comparison of the evaluation process
- The intimation notice under section 143(1) consists of two columns namely
- As provided by the taxpayer in the return of the income
As computed under section 143(1)
Here, this two-column shows the calculation done by both the taxpayer and IT department computing the total income and liabilities. And eventually, it shows who was liable
