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Types of Income Tax Notice


Income tax notice is a written communication sent by the tax department to the tax payer. It can be sent for different reasons like filing / non filing their income tax return, making the assessment, asking for some details etc.

If you have received an income tax notice, it means that the tax authorities have identified a potential issue or discrepancy in your tax return or financial records. The notice is a formal communication asking for clarification, additional information, or payment of outstanding taxes.

Income tax notices are issued by tax authorities to communicate with taxpayers regarding their tax returns, payments, or other tax-related matters. Here are some common types of income tax notice:

  • Notice under section 142(1) : A notice is served by the assessment officer u/s 142 (1) in two cases . firstly , if the officer require additional information and documents pertaining to your income tax returns.
  • Notice under Section 143(1): This is a preliminary notice of assessment that is issued after the tax return has been processed. It provides a summary of the income, deductions, and taxes as per the return filed by the taxpayer.
  • Notice under Section 143(2): This notice is issued for a detailed scrutiny assessment. It notifies the taxpayer that their tax return has been selected for a thorough examination, and they may be required to provide additional information, documents, or attend a personal hearing.
  • Notice under Section 139(9): This notice is issued for defective returns. It informs the taxpayer that their tax return has certain deficiencies or errors that need to be rectified within a specified period. The notice specifies the discrepancies found and provides an opportunity to revise the return.
  • Notice under Section 148: This notice is issued for income escaping assessment. It indicates that the tax authority believes that the taxpayer has undisclosed income, and the tax return filed by them needs to be reassessed. The taxpayer is required to provide explanations and supporting documents to justify their income and expenses.
  • Notice under Section 234F: This notice pertains to the late filing of income tax returns. It imposes a penalty for delayed filing and notifies the taxpayer of the amount due and the deadline for payment.
  • Notice under Section 271(1)(c): This notice is issued for penalty proceedings. It is issued when the tax authority believes that the taxpayer has furnished inaccurate information or concealed income while filing the tax return. The notice provides an opportunity for the taxpayer to explain their position.

There are several other sections under the income tax laws that may be invoked for issuing notices based on specific circumstances. The contents and implications of the notices may vary depending on the individual case.

There can be several reasons why you may receive an income tax notice. Some common causes are described below:

  • If there are inconsistencies or mistakes in the information provided in your tax return, it can raise red flags and lead to a notice. This could include errors in reporting income, deductions, credits, or any other relevant financial information.
  • If the tax authorities have reason to believe that you have not accurately reported your income or have omitted certain sources of income, they may issue a notice to investigate and seek clarification.
  • Sometimes, tax authorities conduct random or selective audits to ensure compliance with tax laws. In such cases, receiving a notice does not necessarily indicate a problem with your tax return, but rather a routine check.
  • Engaging in significant financial transactions, such as large cash deposits, property purchases, or stock market investments, may attract attention from tax authorities and result in a notice to verify the source of funds or assess the tax implications.
  • Tax authorities receive information from various sources, such as employers, financial institutions, and other government agencies. If the information provided by these sources does not match the details reported in your tax return, it can trigger a notice.
  • Failure to file tax returns or repeatedly missing filing deadlines can lead to a notice from tax authorities. It’s important to file your tax returns on time, even if you have no tax liability or if you are eligible for a refund.

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