Non-filing of income tax notice


I got notice for not filing income tax. How to reply?


If you have filed ITR for one year and not filed in the following year, or you have performed high-value transactions and not filed an ITR, then you could get a notice from the I-T Department for non-filing of ITR. If you are a salaried individual with tax being deducted by the company, and you have failed to file the ITR, then you could get a notice from the I-T Department.

If you have received a mail from the Income Tax Department by post, then you need to reply to the authority that sent the notice, giving detailed reasons for not filing the ITR.

If you did not file ITR because your income was below the taxable limit, then mention this in the letter. However, as a best practice, it is better to file an ITR even if your income was below the limit, especially if you have filed returns in the previous years.

Anyone performing financial transactions above a certain limit have to file an ITR. The I-T Department gets information about such high-value transactions through the Annual Information Return (AIR). The relevant high-value transactions in a fiscal year include:

Cash deposit of Rs. 10 lakhs or more in a savings account

Credit card bill payments of Rs. 2 lakhs or more

Purchase of mutual funds worth Rs. 2 lakhs or more

Buying or selling immovable property worth Rs. 30 lakhs or more

Even if you incurred a loss in these transactions or if any of it was a gift of any kind, an ITR needs to be filed. In your reply to the notice, you must specify the reasons you thought you didn’t need to file an ITR. If you made the wrong assumption, then you may file the ITR if the deadline for the assessment year is not already over – in your reply, you can attach the ITR-V/acknowledgement. If there is no time to file a return, then you must attach with your reply a computation of the income and investments and prove that there is no tax due. If tax is due, you may have to pay penalty.

If you are a salaried person and your employer deducts TDS from your salary, then it does not mean that you are exempt from filing return. Tax is deducted from your income when your income exceeds the income tax limits, which means that you are liable to file income tax return irrespective of whether the tax has been deducted from your salary or not. If you are in time for filing the return, then you should file the ITR and attach the ITR-V/acknowledgement with your reply to the authority. If the deadline for filing ITR has passed, then you need to attach a calculation of your income and investments to prove that you have not evaded tax payment.

If you received the I-T notice on mail, then you can reply to it online. Log in to the Income Tax e-Filing website and go to the Compliance section and locate the notice. You can respond with one of the following replies available:

Return is filed

Return under preparation

Business has been closed

No taxable income


Once the relevant option is chosen, go to ‘Related Information Summary’ and fill in the appropriate options.

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