Hello readers! Have you ever accessed your mailbox only to find an official income tax notice from the Income Tax Department? Well, if you have not yet, you might face such a situation anytime soon if you have not filed your return. There are so many salaried taxpayers who receive such tax-related notices for some reason or other. This is why you should know everything about ‘income tax notice salaried employees’.
There could be different reasons as to why the Income Tax Department might send you a notice, especially if you are a salaried individual. It could be due to some discrepancy that occurred from your end while filing the return, or due to some details mismatched, or for some other reason.
If and when you get such notice, you should never ignore it; otherwise, you might end up facing severe consequences like heavy fines or even serving jail time in the worst-case scenario.
In this blog today, you will get to know everything about why income tax notices are sent to salaried people, different types of income tax notices, and other aspects.
What is ‘Income Tax Notice Salaried Employees’?
An income tax notice is nothing but an official message or communication made from the Income Tax Department seeking correction, clarification, or additional clarification in regard to your IT tax filing. The notice could be due to various reasons, such as a mismatch of some minor details or a minor discrepancy made on your part.
The Income Tax Department might send you an email with the subject line ‘income tax notices salaried individuals’ so that you align with their rules and regulations by correcting the discrepancy or error made from your end. It does not always entail wrongdoing or tax evasion. Such notices are mostly about verifying details and information related to your tax filing.
What are the Reasons to Receive the Income Tax Notices?
There could be different income tax notices reasons. Other than business owners, salaried individuals are also likely to get such notices for several reasons, some of which are mentioned below.
Mismatch between Your ITR and Form 16
As an employee, you get the Form 16 from your employer as proof of your salary and subsequent TDS (Tax Deducted at Source). If the details in your reported ITR do not match the Form 16, then you might get a notice from the Income Tax Department.
Unreported Income
Other than your salaries, if you earn some other income from other sources (capital gains, rental income, freelance work, savings account interest, or others) but do not report them in ITR, then you are highly likely to get a notice.
This is another common reason for sending income tax notices for salaried individuals.
High-Value Transaction
If you make a high-value transaction from your account (a flat purchase, a car purchase, etc.), your bank or financial institution may report it to the Income Tax Department. As a result, the authority may send you an official notice asking for the justification for the transacted amount.
Hence, a value transaction might also lead to ‘income tax notices for salaried employees’.
Incorrect Exemptions and Corrections
If you claim deductions or exemptions under 80D, 80C, HRA, or some other provision without the right supporting documents, then there is a high chance that you might get a notice from the authority.
This is what might entail salaried employees income tax notices.
Not Filing ITR
If you miss the deadline for filing the ITR, then you are also highly likely to receive notice from the Income Tax Department. This is one of the most common reasons behind ‘income tax notice salaried employees’.
Errors in House Property Income
If you happen to own some foreign assets, or hold foreign bank accounts, you must disclose them; otherwise, the authority might send you an income tax notice. You will then be scrutinized under the Black Money Act. Moreover, the consequences would be severe, such as heavy penalties or even serving jail time.
Random or Risk-Based Scrutiny
Sometimes, the Income Tax Department sends a random notice to random salaried individuals to scrutinize them. This is another common reason why people might get an income tax notice.
What are the Types of Income Tax Notices?
The Income Tax Act has several sections based on which notices can be issued by authorities. It would help understand the meaning of each of these notices.
Notice Under Section 143(1): Intimation After Tax Processing
This is one of the most frequently occurring notices. It is issued by the department after the completion of your tax filing process.
The notice may mention:
- No discrepancy found
- Calculation of refund
- Additional tax
- Minor adjustments in the return
Most often, this notice works as just a communication of your status.
Notice Under Section 143(2): Scrutiny Notice
An income tax scrutiny notice under this section means that your tax returns have been selected for thorough scrutiny. This is a serious matter, and you have to provide all necessary information and documentation to the assessing officer. But being selected for scrutiny does not necessarily imply tax evasion.
Notice Under Section 139(9): Defective Return Notice
This notice is issued by the department because your tax return is defective.
Some defects may be:
- Information missing
- Tax details incorrect
- Incorrect reporting of income
- Incomplete schedules
You will have to rectify the defect within the given time frame.
Notice Under Section 142(1): Request for Details
This notice is sent by the department requiring more information/documents from you.
It may require you to submit:
- Pay slips
- Banking statements
- Proofs of investments
- Detailed income statement
Notice Under Section 148: Income Escaping Assessment
This notice concerns any income that may have been overlooked while conducting the assessment.
In case there is a doubt regarding certain income that you failed to disclose, the authorities may reopen the assessment and ask for further information.
Notice Under Section 156: Demand Notice
It is issued only when there are dues in taxes, penalties, or interest payable by you. It is to be paid generally within 30 days of the issuance of the notice.
Notice Under Section 245: Refund Adjustment Notice
When you are entitled to a refund but still have some demand pending for a previous period, then you will receive this pre-refund adjustment notice. In this, you can agree or disagree to the adjustment within 30 days.
| Notice Section | Purpose | Response Time |
| Section 139(9) | Defective return | 15 days |
| Section 142(1) | Document/Details request | As mentioned |
| Section 143(1) | Processing intimation/demand | 30 days |
| Section143(2) | Comprehensive scrutiny | As mentioned |
| Section156 | Tax demand payment | 30 days |
| Section148 | Income escaping assessment | As mentioned |
| Section245 | Refund adjustment | 30 days |
How to Verify the Authenticity of an Income Tax Notice?
- Step 1: Visit https://www.incometax.gov.in.
- Step 2: Log in to the site using your PAN and credentials provided.
- Step 3: Head to Pending Actions -> e-Proceedings. The notice will be listed under each e-Proceeding. Any notice that is not found on the portal is highly likely to be fraudulent.
- Step 4: There should be no DIN (Document Identification Number) present on the document. After October 1, 2019, all documents issued will carry a computer-generated DIN as per CBDT rules.
How Can You Detect a Fake Notice?
If any of the following things occur after you receive an income tax notice, then the notice is probably fake:
- Calls for you to pay money to an individual’s bank account or UPI ID
- Threatens that you will immediately be arrested or taken to court in a matter of hours
- Requires you to provide OTP, net banking password, or card details
- Is sent via Gmail, Yahoo, or other non-governmental email accounts (authentic notices use @incometax.gov.in)
- Is filled with mistakes and uses inappropriate language
- Lacks any DIN number and is not reflected in your e-filing portal
How to Respond to an Income Tax Notice in an Efficient Manner?
After authenticating its authenticity, answer it on the government website. Most of the time, notices can be answered through online media alone.
Step 1: Read the Notice Carefully
Step 2: Collect Necessary Documents
Step 3: Log in and Answer the Notice
Step 4: Pick the Right Format
Step 5: Submit & Validate
Note: Complex notices like Section 143(2) or Section 148 notices should never be replied to without professional assistance since an incorrect notice can raise your liability.
Income Tax Notice Avoidance Tips?
Do Cross-Verify Before Filing
Ensure that the data on your ITR is correct according to your Form 26AS, AIS, and TIS data.
Declare the Data of All Your Income
Make sure that you declare all forms of income, whether they be your interest income, dividend income, rental income, freelance income, capital gain income, and many others.
Use the Right ITR Form
Select the appropriate ITR form depending on the type of income you earn. Filing a wrong ITR form will result in a notice from the income tax department.
Monitor Form 26AS all year round.
Ensure that the credits for the tax deducted at source are correct, and also that the PAN number is updated.
Maintain Good Records
Keep your Form 16, investment details, bank account records, and ITR acknowledgement forms safely for six years.
Take the Help of AIS Feedbacks
Use the feedback provided by AIS to update and correct your details as required.
Conclusion
Receiving an income tax notice, salaried employees get worried about need not always be a cause for concern. In most instances, the notice is sent to either clarify some aspect, validate details, or rectify some information that has been provided while filing taxes.
An individual’s knowledge about various notices, reasons for sending income tax notices, and what needs to be done in such a situation could go a long way in resolving issues related to them. In almost all instances, prompt action helps solve issues without much trouble.
Salaried taxpayers will have very little chance of receiving any income tax notice for salaried employees if they keep their accounts in order and report all income. You should also know about 206ct of income tax act.
FAQs (Frequently Asked Questions)
Q1. Can you afford to ignore ‘income tax notice salaried employees’?
No. Because if you ignore it, then you will face severe consequences.
Q2. Which one is the most common income tax notice that salaried people often get?
Section 143(1).
Q3. How to verify the authenticity of an income tax notice?
It would be wise on your part to verify it from the Income Tax e-Filing portal.
Q4. Is an income notice always about wrongdoing or tax misdeeds?
No, not always.
Q5. Does every salaried individual get an income tax notice?
No.
