By Admin 
Income Tax Notice: The Income Tax Department has intensified action against high-income professionals, especially senior executives of multinational companies and startups. On the department’s radar are those people whose annual income is more than Rs 50 lakh and who have allegedly given fake claims or wrong information to save tax. According to reports, those who received the notice include Chief Executive Officer (CEO), Managing Director (MD) and other senior officials of big companies. The department has given them an opportunity to rectify the discrepancies found in their Income Tax Returns (ITR) before any coercive action is taken.
Why are notices being sent?
The Income Tax Department is investigating cases where foreign income has been hidden. House Rent Allowance (HRA) and Travel Allowance have been inflated. Tax exemption has been obtained by showing fake donations to charitable institutions or educational institutions. The correct source of income for the purchase of expensive properties was not disclosed.
Funds received through cryptocurrency from foreign clients, but not declared properly. Donations were shown to political parties that are not recognized or do not participate in elections. Senior officials from sectors like FMCG, hospitality, IT, automobile and engineering-construction are especially under scrutiny.
Why strict scrutiny?
In recent years, returns of high-income taxpayers are being intensively scrutinized using data analytics and AI based tools. Discrepancies are being easily detected by matching data of digital transactions, foreign assets and cross-border transactions. The message of the Income Tax Department is clear that if there is a mistake or wrong claim in the return, then correct it voluntarily, otherwise you may have to face penalty, interest and legal action. This action is being considered as a strict step towards ensuring tax compliance in the high income group and curbing fake claims.