Advance tax notices: Income Tax dept flags error, asks taxpayers to wait

After some taxpayers received inflated advance tax payment notices, the Income Tax Department said it identified "certain inconsistencies" in the financial transaction data reported in the annual information statement (AIS).

Taking to X (formerly known as Twitter), the IT department said, "Based on feedback from taxpayers on the e-campaign for Advance Tax, the Department has identified certain inconsistencies in the data of the securities market (SFT-17) provided by one of the reporting entities. The reporting entity has been asked to submit a revised statement based on updated information."

The tax authority has assured taxpayers that data will be updated on AIS. "Taxpayers are advised to wait for further updates on AIS based on the revised statement," it added.

On March 10, the department launched an e-campaign to inform taxpayers whose tax payments in the financial year 2023-24 did not match financial transactions as reported in AIS.

"The Income Tax Department receives information of specified financial transactions of taxpayers from various sources. To increase transparency and to promote voluntary tax compliance, this information is reflected in the Annual Information Statement (AIS) module and is available to persons/entities for viewing. The value of 'significant transactions' in the AIS has been used for carrying out this analysis," the IT department said in a statement.

What is the Annual Information Statement (AIS)?

AIS or Annual Information Statement is a detailed report of a taxpayer, as displayed in Form 26AS. Taxpayers have the option to provide their feedback on the information displayed in AIS. The statement shows reported value and modified value after considering taxpayer feedback under each section, such as TDS, SFT and other information.