How to deal with Income Tax Notice

Are you confused about how to reply to an income tax notice? You may get an income tax notice for a number of reasons, if you are a tax payer in India. Here’s how you need to receive the notice and reply it promptly.

You may get the income tax notice via email or by post at the registered id or address of the PAN card. You can check the address by logging into www.incometaxindiaefiling.gov.in.

Mainly there are four reasons for which you may get an income tax notice which comes under Sections 143(1), 143(2), 142, 148, 156 etc.

Income Tax Notice

Income tax notice under Section 143(1) – Letter of Intimation

Under Section 143(1), you may get three types of notice. It may be intimation after the assessing authority finds the ITR you filed matches with computation. The notice will be considered as a final assessment of the return. You can take a print out and file it along the income tax file as a record.

Secondly, you may get a refund notice under Section 143(1), if the authority received more amount than that you are supposed to pay as tax. You can soon expect a cheque with the refund amount if you receive a notice under this section.

Next is when the authority’s computation shows a shortfall in the tax amount you paid. If that is the case, you will have to pay the deficit amount within 30 days of the notice. If it is wrong, you need to prove it and go for rectification of the same. The time limit for the notice to be served will remain up to one year, after completion of the relevant assessment year.

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Income tax notice under Section 142 (1)

You receive notice under Section 142(1) if you have not filed the ITR. You may have to appear before the authority and produce the necessary documents to clarify your returns. There will no time bar for this type of notice. Additionally, you will have to pay the deficit amount, if any.

Income tax notice under Section 148

You will get a notice under Section 148 if the authority believes an income is not included in the assessment for the relevant year. If the missed income in the assessment is equal to or less than Rs 1 lakh, you will receive the notice in 4 years. If it is above 6 lakh, the time period may go up to 6 years from the relevant assessment year.  You have to file the returns within the prescribed time in the notice.