Answer: A. Report income and tax liability. An income tax return reports relevant income, deductions, taxes paid, and the resulting liability or refund.
Income earned in FY 2025–26 is reported for which period?
A Tax Year 2025–26
B Assessment Year 2026–27
C Assessment Year 2025–26
D Tax Year 2027–28
Answer: B. Assessment Year 2026–27. The Income Tax Department says FY 2025–26 income is filed for AY 2026–27 under the Income-tax Act, 1961.
Income earned from April 2026 through March 2027 belongs to which return period?
A Assessment Year 2025–26
B Tax Year 2025–26
C Tax Year 2026–27
D Assessment Year 2027–28
Answer: C. Tax Year 2026–27. The Department’s transition guidance uses Tax Year 2026–27 for income arising from April 2026 through March 2027.
Why should the correct Assessment Year or Tax Year be selected?
A To avoid reporting income
B To skip return verification
C To change a bank account
D To use the correct rules
Answer: D. To use the correct rules. The applicable period determines the form and law used and helps ensure that payments and tax credits are matched correctly.
What should guide a taxpayer’s ITR form choice?
A Income sources and eligibility
B Preferred form length
C Employer’s software choice
D A friend’s last return
Answer: A. Income sources and eligibility. ITR forms have different eligibility conditions based on taxpayer status and the nature of income.
An individual has business or professional income. What should be checked first?
A Only the salary schedule
B Eligible form conditions
C Only the refund amount
D A form chosen last year
Answer: B. Eligible form conditions. Business or professional income affects form eligibility; taxpayers should use the current official form instructions for their facts.
Which return may suit an eligible presumptive-income case?
A ITR-1 in every case
B ITR-2 in every case
C ITR-4, when eligible
D ITR-7 for individuals
Answer: C. ITR-4, when eligible. ITR-4 is available only to taxpayers who meet its prescribed eligibility and presumptive-tax conditions.
Which form is generally used by individuals or HUFs without business income?
A ITR-4 for every case
B ITR-6 for individuals
C ITR-7 for HUFs
D ITR-2, when applicable
Answer: D. ITR-2, when applicable. For AY 2026–27, the Department says ITR-2 applies to individuals and HUFs without income chargeable under business or profession, subject to form rules.
What salary information should be checked before filing?
A Salary and TDS records
B Only monthly take-home pay
C Only leave balances
D Only employer’s address
Answer: A. Salary and TDS records. Compare salary details in the return with Form 16, payslips, and other relevant records.
Where can taxpayers compare reported tax credits?
A A credit-card statement
B Form 26AS and AIS
C A utility bill
D A travel itinerary
Answer: B. Form 26AS and AIS. Form 26AS and AIS provide tax-related information that should be reconciled with the taxpayer’s own records.
When is an uploaded return ready for completion?
A After opening the draft
B After saving a PDF
C After required verification
D After printing a copy
Answer: C. After required verification. Uploading the return is followed by e-verification or the prescribed verification method.
How long is the usual e-verification window after filing?
A Seven days
B Fifteen days
C Ninety days
D 30 days
Answer: D. 30 days. The Income Tax Department states that e-verification or ITR-V submission is due within 30 days of filing.
What is ITR-V used for?
A Verifying a filed return
B Reporting bank interest
C Requesting a tax refund
D Registering a business
Answer: A. Verifying a filed return. ITR-V is the verification form used when a taxpayer verifies through the prescribed signed-copy route.
What may happen if a return is never verified?
A It becomes an advance return
B It may be treated invalid
C It is automatically revised
D It creates a refund
Answer: B. It may be treated invalid. The Department says an uploaded return that is not verified is treated as invalid, subject to applicable relief for genuine delay.
Which method can be used to e-Verify an eligible return?
A A debit-card PIN
B A GST invoice
C Aadhaar OTP
D A bank passbook
Answer: C. Aadhaar OTP. Aadhaar OTP is one of the portal’s e-verification methods; other available methods include EVC and DSC, as applicable.
What is the purpose of the Annual Information Statement?
A Replace the filed return
B Certify every deduction
C Set the taxpayer’s tax rate
D Review reported financial information
Answer: D. Review reported financial information. AIS presents information reported from financial transactions and other sources; taxpayers should review it against their records.
Which statement can show tax credits and deposits?
A Form 26AS
B Form 16 only
C A rent agreement
D A bank loan letter
Answer: A. Form 26AS. Form 26AS includes tax-credit information such as TDS, TCS, and deposited tax amounts.
Why reconcile AIS and Form 26AS before filing?
A To avoid keeping records
B To find reporting mismatches
C To change the return year
D To skip income computation
Answer: B. To find reporting mismatches. Reconciliation can reveal omitted income, missing credits, or incorrect information before the return is submitted.
A TDS credit is missing. What is a sensible next step?
A Claim it without checking
B Delete the related income
C Reconcile with deductor records
D Pay the same tax again
Answer: C. Reconcile with deductor records. Compare the deduction evidence with Form 26AS and contact the deductor or follow official portal guidance to resolve the discrepancy.
What is a belated return?
A A return filed before income
B A return with a refund
C Filed by a bank
D Return filed after due date
Answer: D. Return filed after due date. A belated return is furnished after the applicable due date, subject to statutory deadlines and consequences.
What is a revised return generally used for?
A Correcting an earlier return
B Changing a PAN holder
C Requesting an advance payment
D Replacing a bank statement
Answer: A. Correcting an earlier return. A revised return allows correction of an earlier filed return when permitted by law and within the applicable time limit.
What is an updated return intended to address?
A A change in email address
B Previously unreported income
C A bank account validation
D A missing TDS certificate
Answer: B. Previously unreported income. An updated return may be used to report eligible additional income under statutory conditions; it is not a general substitute for every correction.
Can every taxpayer use the same ITR form?
A Yes, income never matters
B Only companies use forms
C No, eligibility rules differ
D Only salary affects selection
Answer: C. No, eligibility rules differ. The correct form depends on taxpayer category and income sources, so one form is not suitable for every filer.
When should a return be filed?
A Whenever a refund is expected
B Only after a tax notice
C After the next assessment year
D By its applicable due date
Answer: D. By its applicable due date. Filing deadlines vary by taxpayer and circumstances; check the current official due date that applies to the return.
What may follow when a return is filed late?
A Fee or interest may apply
B PAN is always cancelled
C All income becomes exempt
D A refund is guaranteed
Answer: A. Fee or interest may apply. A late return may carry a fee, interest, or other consequences under the applicable law and facts.
Why check the official filing calendar?
A Forms are always identical
B Deadlines can vary or change
C PAN numbers expire annually
D TDS is optional
Answer: B. Deadlines can vary or change. Due dates depend on taxpayer circumstances and may be extended, so current portal announcements should be reviewed.
What does an income tax refund represent?
A A loan from the department
B An automatic tax exemption
C Tax paid exceeds final liability
D A salary advance
Answer: C. Tax paid exceeds final liability. A refund may arise when eligible taxes paid exceed the final tax liability after processing.
What generally happens after return submission and verification?
A A new PAN is created
B All deductions are approved
C The bank account is closed
D The return is processed
Answer: D. The return is processed. After filing and verification, the department processes the return and may issue an intimation.
Which document confirms an online return was submitted?
A ITR acknowledgement
B A salary payslip
C A rent receipt
D A bank deposit slip
Answer: A. ITR acknowledgement. The portal generates an acknowledgement after successful submission, which should be saved for reference.
Why must a taxpayer e-Verify the return?
A To select a tax regime
B To authenticate the filing
C To calculate bank interest
D To apply for a PAN
Answer: B. To authenticate the filing. Verification authenticates the submitted return and completes the filing process.
Which records are useful while preparing a return?
A Shopping lists and menus
B Travel photos and tickets
C Income, tax, and deduction records
D Device manuals and warranties
Answer: C. Income, tax, and deduction records. Relevant records can include income statements, tax-credit records, bank details, and evidence for claims made in the return.
Should prefilled income details be accepted without checking?
A Yes, they are always complete
B Only for salary income
C Only when claiming refunds
D No, verify against records
Answer: D. No, verify against records. Prefilled data is a helpful starting point but should be checked against source documents and other official statements.
What should be done after receiving a defective-return notice?
A Respond through the portal
B Ignore it until refund
C File a different PAN
D Delete the acknowledgement
Answer: A. Respond through the portal. Read the notice, correct the identified issue, and respond within the applicable time through the official process.
How should a taxpayer handle a notice deadline?
A Wait for another reminder
B Follow the stated deadline
C Use last year’s date
D Submit an unrelated form
Answer: B. Follow the stated deadline. The taxpayer should read the notice and respond within the deadline stated, using current official guidance.
What does AIS provide to a taxpayer?
A A final tax assessment
B A guaranteed refund
C Information reported by sources
D A replacement for ITR
Answer: C. Information reported by sources. AIS aggregates financial and tax-related information reported to the department; it does not replace the return.
Is a refund guaranteed immediately after filing?
A Yes, within one day
B Only if ITR-1 is used
C Only for salaried people
D No, processing must occur
Answer: D. No, processing must occur. Refunds are subject to return processing, validation, and applicable rules; filing alone does not guarantee immediate credit.
What should be done if the return computation shows tax payable?
A Pay and report the challan
B Submit without payment
C Remove the income entry
D Wait for a refund
Answer: A. Pay and report the challan. The ITR-1 guidance says to pay the calculated self-assessment tax and enter challan details before submitting the return.
Which identity number is central to an Indian tax return?
A Driving licence number
B Permanent Account Number
C Passport file number
D Voter serial number
Answer: B. Permanent Account Number. PAN is the taxpayer identifier used in income-tax filings and tax-credit matching.
What is a careful way to select a return form?
A Copy a colleague’s form
B Choose the shortest form
C Check current official eligibility
D Use any saved draft
Answer: C. Check current official eligibility. Current form eligibility should be checked against the taxpayer’s status and income, rather than copied from another person.
Who is responsible for reviewing return accuracy?
A The browser provider
B The bank alone
C The employer alone
D The taxpayer
Answer: D. The taxpayer. Taxpayers should review the information and claims in their return even when using prefilled data or assistance.
What should a filing checklist include?
A Income, form, credits, verification
B Wallpaper, theme, and font
C Username, PIN, and browser
D Menu, address, and color
Answer: A. Income, form, credits, verification. A final review of income, form eligibility, tax credits, payment details, and verification helps reduce errors.
Which return period is separate from AY 2026–27?
A Financial Year 2025–26
B Tax Year 2026–27
C Assessment Year 2024–25
D Previous Year 2025–26
Answer: B. Tax Year 2026–27. The Department explains that AY 2026–27 for FY 2025–26 and Tax Year 2026–27 for FY 2026–27 are separate compliance obligations.
What should be done if the wrong assessment period was selected?
A Ignore the mismatch
B File another PAN
C Follow official correction guidance
D Delete all tax credits
Answer: C. Follow official correction guidance. Use the Income Tax Department’s current guidance to correct or resolve a period-selection error and ensure the credit is matched correctly.
Which e-Filing utility can assist with return preparation?
A A generic text editor
B A bank loan calculator
C A social-media form
D Official return utility
Answer: D. Official return utility. The department provides return utilities and forms for relevant assessment years; use the current version available on its portal.
Why save a copy of the submitted return?
A For records and follow-up
B To replace Form 26AS
C To make filing optional
D To avoid e-verification
Answer: A. For records and follow-up. A saved return and acknowledgement help with future reference, notices, and reconciliation.
Which action follows selecting e-Verify Later?
A The return is automatically final
B Complete verification afterward
C The tax payment is cancelled
D The form changes to ITR-2
Answer: B. Complete verification afterward. Choosing to verify later does not remove the verification requirement; complete it within the prescribed time.
What is a practical response to conflicting tax data?
A Choose the larger figure blindly
B Delete the disputed record
C Reconcile before filing
D Ignore all prefilled data
Answer: C. Reconcile before filing. Compare source records, AIS, Form 26AS, and return entries, then resolve discrepancies through the appropriate official channel.
Can filing the return replace tax payment due?
A Yes, every time
B Only for businesses
C Only for refunds
D No, pay tax separately
Answer: D. No, pay tax separately. Filing and paying tax are separate compliance steps when a balance is due.
What helps taxpayers track a submitted return?
A Portal filing status
B A bank’s credit score
C A saved browser theme
D An employer’s leave portal
Answer: A. Portal filing status. The e-Filing portal provides return status and processing information after submission.
What final review helps prevent an avoidable return error?
A Theme, font, colors, spacing
B Period, form, income, credits
C Browser, device, screen, keyboard
D Email, phone, username, password
Answer: B. Period, form, income, credits. Before submission, review the selected period and form, reported income, deductions, tax credits, payment details, and verification.