Why the Income Tax Department Is Sending Emails to Taxpayers Claiming Deductions

The Income Tax Department has started sending emails and text messages to a large number of taxpayers who have claimed deductions and exemptions in their income tax returns. The department has clarified that these communications are part of a preventive and corrective approach, not a penalty-driven action. The objective is to alert taxpayers about possible discrepancies in their returns and give them a chance to correct mistakes voluntarily before formal scrutiny begins.

What Triggered These Emails?

During the assessment process for the 2025–26 assessment year, tax officials identified several concerning patterns through risk analytics. According to the department, many returns showed deduction and exemption claims that may not meet the prescribed conditions under the Income Tax Act.

One of the major red flags noticed was donations claimed to non-recognised political parties. Such donations do not qualify for tax benefits, yet they were shown in multiple returns. In addition, officials found cases where exemptions were claimed without fulfilling eligibility criteria and instances where deduction amounts appeared unusually inflated compared to income levels and past filings.

What Is the NUDGE Programme?

The Income Tax Department explained that these emails are being sent under its ‘NUDGE’ programme. This initiative is designed to guide and assist taxpayers rather than immediately initiate enforcement actions. Through NUDGE, the department uses emails and SMS alerts to inform taxpayers about potential issues in their filed returns so they can review and correct them on their own.

Taxpayers who receive such communications are advised to carefully recheck their original returns, especially the sections related to deductions and exemptions.

What Should Taxpayers Do After Receiving the Email?

Taxpayers should review their filed return in detail and verify whether all deduction and exemption claims are accurate and supported by valid documentation. If any error or inconsistency is found, they should file a revised return before the deadline.

If a taxpayer is confident that all claims are correct and compliant with tax rules, and proper documents are available, no further action is required despite receiving the email.

Deadline to File a Revised Return

The Income Tax Department has clearly stated that taxpayers must file a revised return by 31 December 2025 if they discover any mistake in their original filing. Filing a revised return within this deadline helps taxpayers avoid penalties and additional tax liabilities.

If a taxpayer fails to revise the return by 31 December 2025, they will have to file an updated return from 1 January onwards. Filing an updated return involves paying additional tax, which could have been avoided by timely correction.

Why This Approach Matters

Tax experts point out that the department is now using advanced analytics and data-driven tools to detect incorrect or excessive claims. The focus is not only on high-value deductions but also on cases where taxpayers are not legally entitled to the benefits claimed.

At the same time, the NUDGE programme reflects a shift toward a more cooperative relationship between taxpayers and the tax administration. By offering an opportunity for voluntary correction, the department aims to reduce disputes and encourage honest compliance.

Key Takeaway for Taxpayers

If you have received an email or message from the Income Tax Department regarding deduction or exemption claims, do not ignore it. Carefully review your return, verify your eligibility, and file a revised return if needed before 31 December 2025. Acting within the deadline can help you avoid extra tax payments and future complications.