??
SURAJ MENDON
(ACCOUNTANT CUM TAX ASSISTANT)
(31 Points)
Replied 26 July 2012
How come interest on Income tax refund is taxable, under which section is that stated?
since penalty for late payment or non payment of income tax is not allowed as deduction then why interest on refund taxable?
Madhu
(student)
(65 Points)
Replied 06 September 2012
Dear All
Income tax department is deducting TDS then how to get the certificate as we are getiing the credit in 26AS and deduction by CPC,Bangalore and till now we didnot recd
May i know the procedure for getting the same
U S Sharma
(glidor@gmail.com)
(21056 Points)
Replied 06 September 2012
Originally posted by : Madhu | ||
Dear All Income tax department is deducting TDS then how to get the certificate as we are getiing the credit in 26AS and deduction by CPC,Bangalore and till now we didnot recd May i know the procedure for getting the same |
why the department is deducting TDS from you ? are you employed there or executing any works contract under incometax,
please furnish more details !!
Madhu
(student)
(65 Points)
Replied 06 September 2012
Our company Got an Entry in 26 AS for 2011-12 " ASSISTANT COMMISSIONER OF INCOME TAX CENTRALIZED PROCESSING CENTRE, BANGALOR TAN No.BLRA15403D u/s 195 on 02-11-2011 i think it for Intrest on IT refund but we have to get the certificate for that but we dont to whom we have to approach
CA.Saibaburao Nanduri
(Chartered Accountant)
(3847 Points)
Replied 06 September 2012
Dear Mr. Angad kr kannaujiva !
While preparing P & L a/c, we generally shall not take income-tax to the debit of profit and loss account just like other other revenue expenditure such as sales-tax, Licences and taxes etc. Even if some one debits the same in P&L account, it must be added back to arrive taxable portion of the net profit. Hence the income-tax refund in not taxable. As every body in this forum rightly and aptly expressing, that interest on I.T refund is taxable. This is applicable to all classes of assesses including salaried class.
U S Sharma
(glidor@gmail.com)
(21056 Points)
Replied 06 September 2012
Originally posted by : Madhu | ||
Our company Got an Entry in 26 AS for 2011-12 " ASSISTANT COMMISSIONER OF INCOME TAX CENTRALIZED PROCESSING CENTRE, BANGALOR TAN No.BLRA15403D u/s 195 on 02-11-2011 i think it for Intrest on IT refund but we have to get the certificate for that but we dont to whom we have to approach |
discuss the issue with your auditor, as he can co-relate the issue with your accounts / returns and can make you understand his best possible way . as 26AS itself may be treated as a TDS 16A, coz all the data is mentioned therein,
CA.Saibaburao Nanduri
(Chartered Accountant)
(3847 Points)
Replied 06 September 2012
Dear Madhu ! It is the duty and responsibility of the deductor to issue a certificate to the deductee in Form 16A. If you e-file your return, you will automatically get the credit. No physical copy of form 16A is required as there is display in Form 26AS.
U S Sharma
(glidor@gmail.com)
(21056 Points)
Replied 06 September 2012
Originally posted by : Madhu | ||
Our company Got an Entry in 26 AS for 2011-12 " ASSISTANT COMMISSIONER OF INCOME TAX CENTRALIZED PROCESSING CENTRE, BANGALOR TAN No.BLRA15403D u/s 195 on 02-11-2011 i think it for Intrest on IT refund but we have to get the certificate for that but we dont to whom we have to approach |
discuss the issue with your auditor, as he can co-relate the issue with your accounts / returns and can make you understand his best possible way . as 26AS itself may be treated as a TDS 16A, coz all the data is mentioned therein,
U S Sharma
(glidor@gmail.com)
(21056 Points)
Replied 06 September 2012
Originally posted by : CA.Saibaburao Nanduri | ||
Dear Mr. Angad kr kannaujiva ! While preparing P & L a/c, we generally shall not take income-tax to the debit of profit and loss account just like other other revenue expenditure such as sales-tax, Licences and taxes etc. Even if some one debits the same in P&L account, it must be added back to arrive taxable portion of the net profit. Hence the income-tax refund in not taxable. As every body in this forum rightly and aptly expressing, that interest on I.T refund is taxable. This is applicable to all classes of assesses including salaried class. |
Avinash Kumar
(CA Final Student & Working as Deputy Manager Accounts)
(79 Points)
Replied 06 September 2012
Interest received on Income tax refund would be taxable under Income from other sources:
Suppose income tax refund is 110 (Rs 10 Intt)
then treatment in books will be as follow:
individual:
Bank a/c Dr 110
Individual Capital a/c Cr 100
Intt on IT Refund Cr 10
Partnership:
Bank a/c Dr 110
Partners Capital A/c (In their ratio) Cr 100
(or Adv Income tax/TDS)
Intt on IT Refund Cr 10
Company
Bank a/c Dr 110
To Advance Tax/TDS 100
To Intt on IT refund 10
If any correction required pls suggest
Rajesh
(taxation)
(22 Points)
Replied 21 October 2014
Since TDS is already included in the total income and if the same is taxable at the time of refund then it will be a case of double taxation on the same income . accordingly it violate basic principle of taxability.
conclusion:- income tax refund -not taxable at all
interest on income tax refund:- taxable under other sources
mukesh
(student)
(67 Points)
Replied 15 July 2016
can you quote the section under which the income tax refund is exempt?
Virendra Chauhan
(Manager Accounts)
(121 Points)
Replied 17 October 2016
Dear All,
Plz clearfy that is IT refund an income....? if yes, then why......?
Ayush
(Executive )
(6132 Points)
Replied 09 February 2023
In the context of income tax, an IT refund refers to a return of excess tax paid by an individual or a business entity. It is not considered to be income in the traditional sense.
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