Managing NRI income tax notices can be a daunting task, especially when dealing with complex tax provisions like Section 148, Section 148A, and E-Campaign Notices.
At CA EVRK, we provide expert assistance to NRIs to handle these notices efficiently, ensuring compliance with Indian tax regulations.
Understanding Section 148 and 148A Notices:
Section 148: Issued when the Income Tax Department believes that an NRI’s income has escaped assessment. This notice initiates reassessment proceedings to include income that was not declared or was underreported.
Section 148A: Introduced to ensure that the taxpayer is given an opportunity to be heard before issuing a notice under Section 148. This step enhances transparency and allows NRIs to present their case.
Understanding E-Campaign Notices:
E-Campaign notices are issued by the Income Tax Department to seek clarifications on discrepancies detected through automated data processing and data analytics. These notices are usually related to:
- High-value financial transactions
- Mismatch between reported income and financial activities
- Non-compliance or delayed filing of returns
Why Do NRIs Receive These Notices?
- Non-disclosure of income from property or foreign assets
- Unreported capital gains from property sales
- Discrepancies in remittances and NRE/NRO deposits
- High-value transactions detected by the IT Department
- Mismatch between Form 26AS and income declared in ITR
Types of Financial Transactions that Trigger Notices:
Property Transactions: Purchase or sale of immovable property in India.
Investments: Purchase or sale of mutual funds and shares.
Bank Deposits: NRE/NRO fixed deposits and interest income.
Dividend Income: From shares or mutual funds held in India.
Foreign Remittances: Repatriation of money to or from India.
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Steps to Handle Income Tax Notices
Verify the Notice:
- Log in to the Income Tax e-Filing portal.
- Cross-check the authenticity of the notice by entering the notice number.
- Download the PDF and thoroughly review the contents.
Understand the Purpose:
- Identify the specific reason for the notice (e.g., income mismatch, unreported transactions).
- Determine whether the notice requires a response or just clarification.
Draft a Response:
- Clearly explain the discrepancies and provide supporting documents.
- Include bank statements, property sale deeds, investment proofs, and Form 26AS, if necessary.
Submit Your Response:
- Upload the drafted response on the Income Tax e-Filing portal.
- Keep an acknowledgment of the submission.
Seek Professional Guidance:
- CA EVRK’s expert team can help draft accurate responses and represent you before tax authorities.
- We ensure that your interests are safeguarded and compliance is maintained.
Importance of Registered Email Address:
- Notices are generally sent to the registered email linked to your PAN.
- Keep your registered email updated on the Income Tax e-Filing portal.
- Check your email regularly to avoid missing important communications.
FAQs on NRI Income Tax Notices
A: Immediately check the notice on the Income Tax e-Filing portal and consult a professional. CA EVRK can guide you through the response process.
A: Ignoring any notice, irrespective of the amount, can lead to adverse actions by the tax authorities. Always respond accurately.
A: We provide end-to-end support, including verification, drafting responses, and representation before tax authorities.