Need clarification on getting the TDS amount obtained compensation from national highway authority

Hey Vijai! Here’s some clarity on your TDS and compensation situation:

1. Reclaiming TDS now (for older TDS certificates):

• Yes, you can claim refund of TDS deducted even if it relates to earlier years.

• The TDS was deducted in FY 2017-18 and certificate received in 2018.

• If you did not claim TDS credit earlier, you can still claim the credit/refund by filing your Income Tax Return (ITR) for the relevant assessment year.

• If you have already filed returns without claiming the TDS, you can file a revised return for that year.

• The refund (if any) will be processed after verification by the Income Tax Department.

2. Capital Gains tax payment on compensation received:

• If your auditor has correctly computed the capital gains on the compensation amount (₹80 lakhs in your case) and you have paid the tax on it, that is the proper course of action.

• Usually, compensation from government authorities for land acquisition is considered capital gains income.

• You are liable to pay tax on the net capital gain, which is the difference between compensation received and indexed cost of acquisition.

• Payment of capital gains tax on this amount is correct and necessary.

Summary & suggestions:

• Make sure you file your Income Tax Return for the AY in which you got the compensation and TDS certificate, claiming TDS credit properly.

• If you missed that, file a revised return or rectification.

• If you have paid tax on capital gains, ensure that it is reflected in your return.

• Keep all documents (TDS certificate, compensation award, auditor’s report) handy to support your claim.