Quick Summary
Under the Income-tax framework, Form 34 has been introduced as a mandatory reporting requirement for taxpayers claiming deductions on additional employee costs under Section 146 of the Income-tax Act, 2025. The move aligns with the governments continued focus on promoting employment generation whil
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FAQ :
Form 34 is a mandatory reporting document for audited assessees claiming deductions on additional employee costs under Section 146 of the Income-tax Act, 2025. It must be filed along with the Return of Income.
A deduction of 30% of the additional employee cost incurred can be claimed for three consecutive tax years, starting from the year the employment is provided.
Businesses liable for audit under Section 44AB, which are claiming a deduction under Section 146 for additional employee costs, must file Form 34.
Form 34 must be filed along with the Audit Report under Section 63 of the Income-tax Act, 2025, so the due date is the same as for the audit report.
An additional employee is someone hired during the tax year, increasing the total employee count from the previous year's last day. Certain conditions, like emoluments exceeding £25,000 per month or specific employment durations, may exclude them.
Payments to these employees must be made via an account payee cheque, bank draft, or through electronic clearing systems via a bank account or other specified electronic modes.
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