The Income Tax Department has taken a significant step towards enhancing transparency and fostering voluntary tax compliance with its latest initiative – the E-Verification Scheme 2021. This scheme addresses mismatches identified in Income Tax Returns (ITRs) filed for Assessment Year 2021-22 (Financial Year 2020-21) concerning specified financial transactions.
Understanding the Mismatch Issue
In certain ITRs filed for A.Y. 2021-22 cases, a ‘mismatch’ has been detected between the information provided in the ITR and the data on specified financial transactions available with the Department. Moreover, the Department possesses information on specified high-value financial transactions that require scrutiny for taxpayers who have not yet filed their ITRs for A.Y. 2021-22.
Communication Outreach to Taxpayers
Under the E-Verification Scheme 2021, the Income Tax Department is sending taxpayers communications regarding the identified mismatches. These communications are being dispatched to the taxpayers’ registered email accounts. Through this communication, taxpayers are encouraged to review their Annual Information Statement (AIS) via the e-filing portal.
Required Action Steps
If, upon reviewing the AIS, taxpayers find discrepancies or omitted transactions, the Department advises filing updated ITRs (ITR-U) promptly. Additionally, eligible non-filers can submit updated returns (ITR-U) under Section 139(8A) of the Income-tax Act, 1961.
E-Verification Scheme 2021: Guidance for Taxpayers
To ensure compliance and avoid potential penalties, taxpayers should take the following steps:
- Check your registered email for communication from the Income Tax Department.
- Access the e-filing portal to view your Annual Information Statement (AIS).
- Compare the AIS with the information in your ITR for A.Y. 2021-22.
- If discrepancies are found, file an updated ITR (ITR-U) as necessary.
- Eligible non-filers can submit their returns under Section 139(8A) of the Income-tax Act, 1961.
Final Words
The E-Verification Scheme 2021 is a proactive measure by the Income Tax Department to promote transparency and voluntary tax compliance among taxpayers. By promptly addressing mismatches and updating ITRs where required, taxpayers can ensure smooth tax filing processes and avoid potential penalties. Here is the link to the original notification from the Income Tax Department.
Stay tuned for further updates, and check your registered email regularly for communications from the Income Tax Department. For more information and assistance, visit the official e-filing portal of the Income Tax Department.