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Tax treatment of recovery during current fy pertaining to py

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This query is : Resolved

ajayCA (Querist)

03 December 2014 During the FY-2013-14 an Employee received Arrear of Rs.500000/- due to change in pay scale effective from previous years, accordingly we deducted Tds and issued Form16 during 2013-14 and he filed his return and processed by income tax deptt. Now during the Current Financial year his pay scale again revised due to management decision and this time reduced from previous years accordingly amount recovered from him to the tune of Rs. 200000/- my query is how we will treat this from income tax point of view and how to issue him form 16, whether recovery to be shown in the current form 16 or he will claim refund from income tax department which was deducted excess in the previous year. Pls clarify

Amol S Joglekar

Amol S Joglekar (Expert)

03 December 2014 Did u claim 89(i) for last year?

If NOT, just deduct 200,000 from this year's gross salary (Salary received or receivable)

If YES, make use of 89(i) this year as well.

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