Income Tax Department Clarifies Misinformation Regarding HRA Claims
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The Income Tax Department has addressed the concerns raised by taxpayers regarding discrepancies found in their provided information during routine verification exercises. The department clarified that there is no basis for concerns about retrospective taxation or reopening cases related to incorrect HRA claims and rent paid by employees.
Read Also : IndusInd Bank Q1 FY25 results, net profit at 2% YoYInstances of discrepancies between rent paid by employees and rent receipts by recipients were noted by the Central Board of Direct Taxes (CBDT) for the financial year 2020-21. The primary objective of this e-verification exercise was to bring attention to cases where there were mismatches in information for the financial year 2020-21, without impacting other cases.
Read Also : RBI issues guidelines on higher liquidity coverage ratio for retail depositsMeanwhile, taxpayers are readily advised to stay vigilant and ensure accuracy in their tax returns. The Income Tax Department is ensuring committed to transparent and equitable tax administration, and any further inquiries or concerns from taxpayers will be subject to addressed accordingly.
Notably, this verification process was carried out in a limited number of cases and did not involve the reopening of a large number of cases. This is particularly significant as taxpayers had the opportunity to file updated returns for the financial year 2020-21 (Assessment Year 2021-22) until March 31, 2024.
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