Form 26AS Mismatch? Your Tax Bill Can Skyrocket

If the income shown in your Form 26AS doesn't match what you declared in your ITR, the tax department can add that difference to your taxable income — sometimes crores of rupees — and demand tax on it. Here's how to protect yourself.

Here's what happened: ITAT Rajkot sent a ₹1.97 crore Form 26AS-based addition back for fresh examination because new evidence under Rule 46A was not properly considered at the appeal stage.. The tribunal directed the assessing officer to submit a remand report, giving the taxpayer a formal second chance to explain the disputed income entries with supporting documents.. Form 26AS additions happen when third parties — banks, employers, property registrars — report income against your PAN that you did not fully explain in your ITR..

What you should do: Download your AIS and Form 26AS from incometax.gov.in right now and flag every entry that doesn't match your actual income or ITR filing.. If you receive a scrutiny notice citing a Form 26AS mismatch, respond within the deadline with documentary proof — bank statements, sale deeds, TDS certificates — do not ignore it.. If an addition is already confirmed at the AO level, file an appeal with CIT(A) and invoke Rule 46A to submit any fresh evidence you couldn't present earlier — this is your legal right..

You can correct wrong third-party entries in your AIS directly — click 'Feedback' against the disputed transaction on the income tax portal before the AO uses it against you.