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“No need to wear Helmet & ride. If accident happens, we will not give you insurance".

Dear Salary  ITRians,

Hope you all had read recent notification by IT dept on exemption from filing of ITR & you would have felt relaxed & happy that you are saved from compliance of filing ITR this year. Here is my analysis on that notification.

It is true that Government has relaxed filing of tax norms for salaried people.

Before feeling happy, I would like to ask you to introspect on following questions:

1. How many of you had really looked into salary slip every month & found out reasons for increase or decrease of salary deposited in bank?

2. How many had really had looked into Income Tax deducted by employer is as per your declaration?

3. How many of you had really looked into bifurcations & implications of other allowances & deductions in the pay slip with respect tax liability?

4. How many of you had declared your investment details in April with Employer & had able to invest money as per that before December without cash crunch?

5. How many of you had really have update on amendments in tax rules every year & impact on you?

If you feel that you had answer for above points as YES & can say that I am saved from filing of tax returns. Please read analysis of notification below:

 

Sl No

Notification

Effects

1    

You have Salary +Interest

Assesses who have income other than salary, interest will not be exempt

2    

Salary Should not cross Rs. 5,00,000/-

Once it crosses 5,00,000 sorry, No exemption

3     

Interest must be from Savings Bank only.

I don’t think there will be many people who earn more than 250,000 in a year and not invest it in stocks, shares, gold, silver or at least in Fixed Deposits.

4    

Interest Income i.e. from SB has to be informed to your employer and tax has to be deducted at source on such income from your employer.

Joke, most of us will not know how much we will be receiving interest on the SB account, If we have time to calculate that I think it is better to file the returns.

 

 

5    

There must be only one employer during the whole financial year.

So if you have changed a job you will have no exemption.

6

Other not specifically stated in the notification but can be extracted out of it.

i)        Have to tried to save taxes by way of purchasing NSC, ELSS, MF

ii)      Have to obtained investment under section 80CCF

 

 

 

 

Need to File

 

Need to file

 

 

Again watch for these points:

1. Your Employer may be deducted more tax, then you need to file tax return to get refund. Otherwise you will loose that amount.

2. Your employer may be deducted less tax based on your declaration, you need to do self assessment & pay tax. You cannot pass your burden of tax payment on your employer.

3. Your employer would have not considered few deductions & deducted more tax. You can file your return & claim benefit .

4. Sometimes, you may not able to invest amount before January every year & could not able to give proof to your employer. You will loose benefits of claiming extra benefits if you invest in the month of Feb & March & want to opt out of “Not filing your tax return”.

5. Government has reserved its right to send notice if they found any extra income in your kitty in future years or wrong tax liability.

 

Please note that Tax return filing is not a burden & it is not a data entry job of filling details of Form 16 in Tax return. Its assessment of your income for the financial year & you do that exercise to analyze your total Income & payment of tax.

 

Last but not least, Compliance of Law is best friend in worst time. No one give you loan if your financial story is unknown & not clear.

 

So, in my view, above notification is good for nothing. It does not serve any purpose. It is just saying that “No need to wear Helmet & ride. If accident happens, we will not give you insurance”.   

 

Better plan for comply the rules & file your tax returns within due date.


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Category Income Tax, Other Articles by - CA. Chikkerur C R 



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