The Income Tax Department on Tuesday issued a press release clarifying why several taxpayers have received emails and SMS alerts seeking a review of their tax deduction and exemption claims.The department urged taxpayers to review their deduction and exemption claims for the current assessment year and take corrective steps before the revised deadline of December 31 to avoid penalties or further scrutiny.
Why are taxpayers getting intimations?
According to the release, advanced risk analytics under its risk management framework have flagged certain Income Tax Returns (ITRs) for Assessment Year 2025-26.These include cases where deductions or exemptions appear to be ineligible, such as claims related to bogus donations to Registered Unrecognised Political Parties (RUPPs).The department also observed errors in some returns, including incorrect or invalid PAN details of donees and discrepancies in the amount of deductions or exemptions claimed.Taxpayers are being contacted via SMS and email under the department’s NUDGE (Non-intrusive Usage of Data to Guide and Enable) campaign. They are advised to review their returns and file revised ITRs, if required, by December 31, to avoid further enquiries.
What is the department asking taxpayers to do?
The Income Tax Department said the initiative reflects a “trust-first” approach, which gives taxpayers an opportunity to voluntarily correct mistakes instead of facing immediate enforcement action.Taxpayers are advised to verify their deduction and exemption claims using supporting documents and reconcile details with Form 16, Form 26AS, the Annual Information Statement (AIS) and the Taxpayer Information Summary (TIS). If errors are found, they should revise their returns within the prescribed timeline.Those whose claims are genuine and legally correct do not need to take any further action, the department clarified.The department added that taxpayers who miss the December 31 deadline may still file an updated return from January 1, 2026, as permitted under the law, though this would involve payment of additional tax.During FY 2025-26, more than 21 lakh taxpayers have already updated their ITRs for assessment years ranging from 2021-22 to 2024-25, paying over Rs 2,500 crore in taxes. For the current assessment year (AY 2025-26), over 15 lakh returns have already been revised.
Why are refunds being delayed for some?
Several salaried taxpayers, particularly those under the old tax regime, have reported receiving intimations stating that their refund processing has been temporarily put on hold due to discrepancies in deduction claims.Tax experts say many such cases involve deductions like Sections 80C, 80D or HRA that were claimed directly in the ITR but were not declared to employers during TDS calculations.Chartered accountants have clarified that this does not automatically make a taxpayer non-compliant, as the Income Tax Act allows eligible deductions to be claimed directly while filing returns, even if they were not considered by the employer.
What happens if the intimation is ignored
Experts warn that ignoring such communications can have consequences. If discrepancies are not addressed, the department may disallow the deductions, leading to additional tax demand, interest, penalties, delay or cancellation of refunds and even detailed scrutiny or assessment.Tax professionals advise taxpayers not to panic but to promptly review their returns and respond appropriately to avoid future complications.
