What To Do When You Get A Tax Notice?

The basic check list of things when you get a tax notice:
1. Preserve Envelope
2. Check Your Details
3. Make Copies Of Notice
4. Check The Validity
5. Check Sender's Details
6. Organise Documents
7. Seek Professional Help
1. Preserve Envelope: The envelope in which the notice is sent is an important piece of evidence. It will have the Speed Post number which establishes when the notice was posted and served to you.

2. Check Your Details: It could be that the notice was meant for someone who shares your name or date of birth. Check if it has your PAN. Go by the PAN if there is discrepancy in the name & address. The department issues notice according to PAN, not by name.

3. Make Copies Of Notice: You can't afford to lose the notice so make photocopies or scan and store it on your computer.

4. Check The Validity: A notice under Sec 143(3) for srcutiny assessment has to be served within 6 months from the end of the financial year in which the return was filed. If served later than 6 months, it will be deemed invalid.

However, a notice under Sec 148 can reopen a case even up to 6 years from the end of relevant assessment year if the AO has reason to suspect income escapement. If the amount in the question is less than Rs1 Lakh, only up to 4 years case can be reopened for scrutiny. It may be noted that the intimation under Sec 143(1) cannot be treated as notice/order of assessment as its a mere acknowledgement of the return filed online.

5. Check Sender's Details: a notice must have the name and description of the officer, his signature, stamp, office address and must mention the name of income tax ward and circle. There is a new concept of notice being sent via email, in such case one should ensure that the notices/intimations which are received via emails contain a document identification number.

6. Organise Documents: It could be that your return has been picked up for scrutiny at random. So don't panic and gather all the documents and other information sought by the AO.

7. Seek Professional Help: It is is just a demand notice for excess tax, an individual can handle it on it own. But if the matter is a little complicated, it is best to take help from a professional. You may be required to appear before the AO to explain any discrepancy in the return or make a clarification. A professional can help you organise your response so that you can provide cogent and specific clarifications.

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