Superannuation
This query is : Resolved
20 September 2012
Our company follows a policy of paying superannuation benefits to senior management employees payable on superannuation or resignation provided they have completed min 5 years of service.
*As per provisions of Income Tax Act Employer contribution to superannuation fund in excess of Rs 1 lakh is taxable in hands of employee in the year in which contribution is made.
*The company is adding excess income in the return of employees and is deducting TDS thereon.
The query is, in case an employee leaves the company before completing the service for period of 5 years,he would not be eligible for the superannuation benefits.But the Tds has already been deducted on the employer contribution exceeding Rs 1 lakh for the period of service though the income has not been actually received.Now as he wont be eligibile for the superannuation benefit what will be the procedure for refund of the TDS already deducted..Whether the employee will be entitled to refund if he files a claim?
*As per provisions of Income Tax Act Employer contribution to superannuation fund in excess of Rs 1 lakh is taxable in hands of employee in the year in which contribution is made.
*The company is adding excess income in the return of employees and is deducting TDS thereon.
The query is, in case an employee leaves the company before completing the service for period of 5 years,he would not be eligible for the superannuation benefits.But the Tds has already been deducted on the employer contribution exceeding Rs 1 lakh for the period of service though the income has not been actually received.Now as he wont be eligibile for the superannuation benefit what will be the procedure for refund of the TDS already deducted..Whether the employee will be entitled to refund if he files a claim?
20 September 2012
The procedure for all is same. File the income tax return of that INDIVIDUAL. (Employee)
20 September 2012
The query is not resolved sir..Is the treatment being done is correct and whether the employee should file claim for refund..Kindly elaborate and explain..Thanks
20 September 2012
Yes. The employee should file the return and claim for the refund, if any.
22 September 2012
Sir, revised return can be filed with in the one year from the end of relevant assessment year..And suppose the assessee worked for 4 years and left the job and thus he is not entitled to superannuation benefits as per company policy ,so how can he revise his return of first 2 years as the time for revised return has expired
22 September 2012
You are absolutely correct. For old refunds, we need to take permission from the department; which itself can be costly/ impracticable approach. The employee to take the call, in that case.
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