Income tax compliance refers to adhering to the tax laws and regulations set by the government. It involves timely filing of income tax returns and paying taxes as per the prescribed rates. Businesses and individuals must report their income accurately and claim deductions legally. Non-compliance can lead to penalties, interest, and legal consequences. Compliance includes maintaining proper financial records and documentation. Taxpayers must reconcile their income and expenses with bank statements and financial records. Companies must deduct Tax Deducted at Source (TDS) on specified payments and deposit it with the government. Advance tax payments may be required for individuals and businesses with high tax liability. Tax audits are mandatory for businesses exceeding specified turnover limits. Filing tax returns within the due date is crucial to avoid penalties and interest charges. Income tax compliance also includes proper disclosure of foreign income and assets. Non-disclosure of taxable income can result in scrutiny and penalties from tax authorities. Tax planning helps businesses and individuals optimize their tax liability legally. Corporate tax compliance involves payment of corporate tax, MAT (Minimum Alternate Tax), and other levies. Startups and small businesses must comply with tax exemptions and deductions as per government schemes. GST compliance is linked to income tax compliance for businesses dealing with goods and services. Proper documentation of invoices and expenses helps in claiming deductions and avoiding tax disputes. Taxpayers must verify Form 16 and Form 26AS to ensure proper TDS credit. Failure to deposit TDS on time attracts heavy penalties and interest. Employees must ensure correct reporting of salary income and allowances. Self-employed individuals must maintain records of professional income and expenses. Businesses must file TDS returns periodically to stay compliant. Non-resident Indians (NRIs) have specific tax compliance requirements based on their residency status. Taxpayers can avail of deductions under various sections like 80C, 80D, and 80G to reduce tax liability. Online tax filing portals have simplified income tax compliance for individuals and businesses. The government uses artificial intelligence to track tax evasion and ensure compliance. Taxpayers must respond to tax notices and assessments within the prescribed timelines. Late filing of income tax returns can lead to loss of benefits and additional interest payments. Businesses must comply with transfer pricing regulations while dealing with international transactions. Taxpayers should seek professional advice to ensure full compliance and avoid legal issues. Proper income tax compliance builds financial credibility and prevents legal risks.