India's Tax Department Highlights AI Filing Risks and AIS‑ITR Mismatches

The Indian Income Tax Department warns that using generic AI tools to prepare income‑tax returns (ITRs) can lead to errors, especially when the AI does not cross‑check data with government records. Mistakes in selecting the correct form, reconciling income, or applying deductions may trigger refund delays, notices or additional liability.

Taxpayers are urged to verify the Annual Information Statement (AIS) against their return, ensuring that interest, dividend, capital‑gain and TDS entries reported by banks, employers and financial institutions match the figures filed. Significant mismatches identified by the department’s automated analytics can result in electronic notices and further scrutiny. Services such as TaxBuddy AI aim to combine intelligent automation with tax‑expert oversight to reduce these risks.