Rectification of Income Tax Returns - Complete Guide

This document covers

1. How to Rectification of income tax return filed ?
2. Some of the examples for filing Rectification u/s 154
3. Orders that can be rectified u/s 154
4. Who can file the Rectification?
5. Time Limit for filing Rectification
6. Types of Rectification
7. Details that cannot be changed through Rectification
8. Filing multiple Rectification requests

1. How to Rectification of income tax return filed ?

• Rectification can only be filed once the income tax return filed is processed u/s 143(1) and the intimation is received.
• Rectification is to be filed if there is any mistake apparent from the record.
• Section 154 of Income Tax Act 1961 deals with rectification.
• The following errors can be corrected by using the rectification facility.
  1. Arithmetical mistakes
  2. Clerical errors
  3. Incorrect Claims
  4. Mistake of Facts
  5. Mistake of law
  6. Subsequent decisions of supreme court
  7. Retrospective amendment of law

2. Some of the examples for filing Rectification u/s 154

1. Mismatch in TDS Credit and TCS credit
2. Mismatch in Advance in Advance Tax or Self-Assessment tax Paid
3. Treatment of Non-Agriculture income as agriculture income and granting exemption is a mistake which can be rectified.
4. Personal information like gender
5. Date of filing of original return wrongly considered.

3. Orders that can be rectified u/s 154

The following orders can be rectified u/s 154

1. Intimation or deemed intimation u/s 143(1)
2. Any order passed by Income Tax under the provisions of Income Tax Act
3. Intimation u/s 200A(1) (TDS Returns)
4. Intimation u/s 206CB(1) (TCS Returns)

4. Who can file the Rectification?

The following persons can file the rectification

1. The taxpayer who has filed income tax return can apply for rectification of mistake.
2. The Income Tax Authorities can rectify the mistake on its own motion

5. Time Limit for filing Rectification

1. Rectification order can be passed before the expiry of 4 years from the end of the financial year in which the order sought to be rectified is passed.
2. The period of 4 years is from date of order sought to be rectified and not from the original order.
3. If the application for rectification is made by the taxpayer, The authority shall amend the order or refuse to allow the claim within 6 months from the end of the month in which the application is received.

6. Types of Rectification

Rectifications are of 3 types.

1. Reprocess the Return:

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   • This will be done if the taxpayers have furnished the correct Income Tax return and CPC has not considered the same
2. Return Data Correction:

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   • If the taxpayer wants to make any changes in the return filed, he needs to download the JSON, make the changes and reupload the JSON. While doing this, the taxpayer should not declare any new source of income or additional deduction. The Gross Total Income and Net Total Income should not be changed.
3. Tax Credit Mismatch:

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   • If the taxpayers want to correct TDS, TCS, Advance Tax and Self-Assessment Tax details, he needs to opt for the same.

7. Details that cannot be changed through Rectification

The following details cannot be changed through Rectification.

1. Bank Details
2. Address Details
3. Additional Income
4. Additional Deductions
5. Claim of Additional losses
6. Change of ITR (For example, If you have filed ITR 1 in original Return , you cannot file ITR 2 in rectification)

8. Filing multiple Rectification requests

• Multiple Rectifications can be filed but previous rectification filed should be processed before filing new one.
• Rectification filed once cannot be withdrawn