Defective return notice for FY23-24
This query is : Resolved
22 July 2024
I have filed an ITR taking salary and income from other sources w.r.t. rent received on letting out of vehicle, TDS has been deducted under 194I(a) 10 percent and 2 percent.
Now department has issued notice for defective return saying
You have filed your income-tax return in form ITR-1. As per TDS details in your Form 26AS, taxes have been deducted under sections 194IA/194IC/194M/194S/194C/194B/194BB/194BA, etc. of the Income-tax Act, 1961. These sections are reflected as (4IA/4IC/94M/94S/94C/94B/4BB/4BA) in Form 26AS. These sections imply heads of income for which form no. ITR-1 is not the appropriate form. Thus, the required schedules for reporting incomes pertaining to said TDS sections are not present in your return of income filed in form no. ITR-1.
Which ITR form to be filed?
Do I need to show it as business income?
Now department has issued notice for defective return saying
You have filed your income-tax return in form ITR-1. As per TDS details in your Form 26AS, taxes have been deducted under sections 194IA/194IC/194M/194S/194C/194B/194BB/194BA, etc. of the Income-tax Act, 1961. These sections are reflected as (4IA/4IC/94M/94S/94C/94B/4BB/4BA) in Form 26AS. These sections imply heads of income for which form no. ITR-1 is not the appropriate form. Thus, the required schedules for reporting incomes pertaining to said TDS sections are not present in your return of income filed in form no. ITR-1.
Which ITR form to be filed?
Do I need to show it as business income?
22 July 2024
File ITR 2 & declare the rental income under head IF HP.
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22 July 2024
How can it be shown as house property, as it is not a land or building. Vehicle forms part of plant and machinery?
And rent from plant and machinery has to be shown under other sources, right?
And rent from plant and machinery has to be shown under other sources, right?
22 July 2024
The name of the schedule is IFHP. But for declaring rental income on which TDS u/s. 194I(a)/(b) are deducted can only be declare under this schedule. The defect can be removed only by declaring the rental income in IFHP, till department makes any amendment.
22 July 2024
But sir hasn't department specifically under section 56 considered rental income from plant and machinery as other source income.
Also if declared under IFHP it would straight forward take 30 percent standard deduction.
And if an assessee engaged in business of giving cars on rental basis, in such case, will it be shown under IFHP?
Also if declared under IFHP it would straight forward take 30 percent standard deduction.
And if an assessee engaged in business of giving cars on rental basis, in such case, will it be shown under IFHP?
22 July 2024
Yes, you are right, but the department analyses it as per IT software developed by non financial professionals. Check if you can change the option of 'source of income' in Schedule TDS2 against the TDS entry. If yes, you can go ahead.
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