Taxpayers must verify details in AIS, Form 26AS, and Form 16 before filing ITR to avoid errors and notices. Discrepancies should be corrected via the AIS portal or with the deductor. All income, even if missing from AIS, must be disclosed. The onus of accurate reporting lies with the taxpayer.
Taxpayers must cross-check the details in their Annual Information Statement (AIS), Form 26AS and Form 16 and report any discrepancy before filing their Income Tax Return (ITR). Being proactive with discrepancies ensures accurate filing and avoids unnecessary notices or adjustments by the department.
How to rectify discrepancies
Identify the mismatch: The taxpayer needs to check whether the error is due to incorrect reporting by a third party (like a bank or employer), duplication of entries, or the statements are yet to be updated.
Raise feedback on AIS portal: In case of discrepancies, the taxpayer should login to their AIS portal and provide feedback, specifying the nature of the mismatch—whether the information is incorrect, not related, or partially correct.
Reach out to the source: It is advisable to reach out to the deductor (such as your employer, bank, etc.), since the feedback provided on the AIS is routed to the respective source for verification. Proactively informing them can help ensure timely rectification of the error at their end.
Keep documentation ready: Maintain supporting documents like salary slips, bank statements, Form 16, interest certificates, and communication with the deductor to substantiate your claims.
Wait for correction (if time permits): If the deductor agrees to correct the entry and you are within the due date, wait for the correction to reflect before filing your ITR.
File return with correct information: If the discrepancy remains unresolved before the due date, file your return with the correct details as per your records and documentation, and be prepared to respond to a possible notice.
Neeraj Agarwala, partner, Nangia & Company, suggests saving acknowledgment of the feedback submitted on the AIS portal or communication with the deductor. “It may help in case of a later inquiry or scrutiny,” he adds
Time for resolution
In case there is an error that needs to be rectified by the tax deductor (employer, bank, etc.), the person has to file a revised TDS return. The resolution may take a few days to a few weeks, depending on the deductor’s response. The correct amount will reflect in the AIS once the revised TDS return is processed.
However, if the taxpayer has identified such discrepancies and the error is not rectified till due date of filing of tax return, the taxpayer is likely to receive a notice from tax department. It is recommended to maintain evidence to justify the basis of reporting in ITR.
“Ensure that the ITR reflects the correct figures, not the incorrect AIS entries. Documentation should be preserved to justify the stand if the return is picked up for review,” says Preeti Sharma, partner, Global Employer Services, Tax & Regulatory Services, BDO India.
Missing income in AIS
AIS is not a complete record of taxable income. If an income is missing but is otherwise taxable, the taxpayer must still report it and pay tax. Examples include savings account interest below the bank’s reporting threshold, income earned in the name of minor children which must be clubbed with the parent’s income, rental income under Rs 1 lakh annually that may not have been reported by the tenant via TDS.
Capital gains on sale of shares or mutual funds may not show if the broker has not reported in time or if the transaction is off-market. Freelance income may not reflect in the AIS if no TDS is deducted or foreign income not routed through Indian intermediaries. Again, gifts received from non-relatives, may not appear in the AIS as there is no requirement for the giver to report them.
Regardless of AIS visibility, the responsibility to accurately declare all income and pay the corresponding tax lies solely with the taxpayer. Sandeep Sehgal, partner, Tax, AKM Global, a tax and consulting firm, says non-reporting on the basis that such income is absent in AIS does not absolve the assessee from liability. “The onus to disclose is on the taxpayer as per statute,” he says.
If there is a mismatch—for example, if the taxpayer under-reports interest income, omits sale of property, or claims a deduction without corresponding evidence—the system can flag these discrepancies. This may result in the generation of automated notices, alerts, or requests for explanation.
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