Tax treatment of joining bonus repaid in next financial year

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Guest

Hi,

I received a joining bonus of amount X in March 2015. The Form 16 issued by the employer included this as my income and tax was deducted accordingly.

Now I would leave the company in September 2015 and according to my employment contract, I would need to return the joining bonus amount X to my employer. But tax on X has already been deducted during FY 2014-15.

What are the possible ways in which I can get back the income tax on X? Please do let me know your views on this. I'd be really grateful for your help.

Thanks,

Mish

Replies (5)

Ashok J

CA Final

848 Points Posted on 25 August 2015

Deduct amt x frm ur income n file return for fy 15 16 n claim refund

Guest

Posted on 25 August 2015

Thanks Ashok. Two queries:

1) What if my employer doesn't deduct this X amount in form 16 for fy 2015-16?

2) Whereas I was charged 30% for X in 2014-15, if I claim it back in FY 2015-16, it would only be given back to me at 20%. How do I get back the total amount?

Can you please resolve above queries.. Thanks..

Udgam Koomar

Tax Technologist

2037 Points Posted on 26 August 2015

I dont think this can be done. IMO return the bonus after adjusting the tax if the company agrees or may be share the burden. If you are terminating the contract, company may say why they should bear the tax burden.

Ashok J

CA Final

848 Points Posted on 26 August 2015

Wen form 16 is issued for fy 15 16, enquire whether x has bn deducted . If yes dont worry. If not do as per previous msg... Last yr n this yr if u fall under same tax bracket, refund amt will be correct.... Logically u shudn pay tax on income which u hv never earned