TAXAJ

Salaried Individual Tax Filing

Every assessment year, the Income-tax return filing season acts as a beehive of worries and excitement for salaried individuals. Since salaried individuals shell out actual money for taxes from their salary for the said financial year, they are keener on tax saving options. Being a taxpayer, you should know various tax saving options for salaried individuals and your tax slab. It will help you figure out how a salaried person can save taxes and avoid complications during tax planning. Income tax planning for salaried individuals is always complicated. Now take a look into the tax saving options for salaried people. Salaried people get Form 16 from their employer, which gives information on salary earned and its bifurcation along with advance tax payment information. Besides the basic salary of an employee, there are numerous other components being benefits that are wholly or partially taxable. Further, there are tax saving options like eligible investments under SEC 80C, donations made etc.

Page 1Created with Sketch.

About This Plan

File your Income Tax return with Tax Experts. Claim your tax benefits under Section 80C and other applicable sections

Created by potrace 1.15, written by Peter Selinger 2001-2017

Timeline

It usually takes 3 to 5 working days.

Buy Now
Services Covered
Who Should Buy
How It's Done
Documents Required
Services Covered

  • Tax filing for salaried individuals with single or multiple Form 16
  • Tax filing for salaried individuals with house property
  • Filing Director and Shareholder details in Individual Tax return
  • Tax Due/Refund Status and Filing Confirmation
  • Expert Assisted Tax Filing
  • Business Hours CA Support - Email & Phone
Who Should Buy
  • Employees with Only Salaried / Interest Income above Rs. 50 Lacs
  • Salaried Employees with single or multiple Form 16
  • Salaried Employees with ownership of single or multiple properties
  • New Joinees / Freshers
  • Director in a company
  • Shareholder in Unlisted Company
How It's Done

    • Upload documents on vault
    • Review Computation Sheet
    • Get ITR-V after e-filing
Documents Required
  • All Form 16 Part A & B from your Companies
  • PAN & Aadhar Card
  • Income Tax Login Credentials
  • Bank statement if interest received is above Rs. 10,000/-
  • Salary Slip of any month during the Financial Year
  • Bank Account Number, IFSC Code
  • Any Other Income or Investment Proofs that hasn't been declared or mentioned in Form 16.
 Q. Which forms are applicable to a Salaried Individual?
The ITR for a salaried person depends on their income and the category of taxpayers to which they belong. ITR 1 and ITR 2 are the forms relevant to a salaried person.
ITR 1: The Sahaj form is to be filed by employees whose total annual income doesn’t exceed Rs 50 lakh. An individual whose income from agriculture doesn’t exceed Rs 5000 or who has a one-house property also falls under the ambit of ITR 1.
ITR 2: It is for the use of individuals whose income is more than Rs 50 lakh. The income source may involve income from capital gains, or the agricultural income may exceed Rs 5000. Also, if the individual has made investments in unlisted equity shares, they have to file ITR 2 instead of ITR 1.
   Allowances and Deductions Allowed to Salaried Individuals
Salaried employees form a significant chunk of taxpayers in the country, and their contribution to the tax collection is quite substantial. Income tax deductions offer numerous options for saving tax for salaried class individuals. With these deductions and exemptions, one could reduce their tax substantially. 

Please find below some of the significant deductions and allowances available to salaried persons, which can reduce their income tax liability.

H.R.A. House Rent Allowance

Salaried individuals having a rented accommodation can get the benefit of H.R.A. (House Rent Allowance). It could be totally or partially exempted from income tax. If you forgot to submit rent receipts to your employer as proof to claim H.R.A., do not worry at all. You can still claim the H.R.A. exemption while filing your income tax return. However, it will be taxable if you aren’t living in rented accommodation and continue to receive H.R.A. So, please keep handy your rent receipts and evidence of payment made to the landlord or towards rent.
You may claim the least of these three formula amounts as H.R.A. exemption.
a. Total H.R.A. received from your employer
b. Rent paid less than 10% of (Basic salary +DA)
c. 40% of salary (Basic salary+DA) for non-metros and 50% of salary (Basic salary+DA) for metros
  Q. How to File Income tax Return Online?

There are two ways in which an individual can file his Income Tax Return. One is by entering the details on the portal itself. The other involves downloading the ITR software, preparing the details to be filed in XML format, and then uploading to the portal directly. A salaried employee can smoothly file his ITR by visiting: www.incometax.gov.in/.

Please follow the steps:

👉 Keep handy all the necessary documents like PAN, Aadhaar, Form 16, bank and investment details or any donations.

👉 Go to www.incometax.gov.in/, select the user type that you are.

👉 Download and make changes in Form 26AS as per your specifications. It's a summarized statement of all the taxes deducted from your income this financial year.

👉 Calculate your total income tax liability for this year.

👉 Deduct eligible amount from tax liability. e.g. TDS.

👉 After paying all the tax dues, when the payable amount is set off completely, you can file ITR.

👉 You need to do ITR verification by any of the six methods provided. The best & easiest one is by Aadhar OTP.

👉 Once the e-verification is done, the IT department will process the ITR by verifying all the details you provided.

Standard Deduction

The Indian Finance Minister, while presenting the Union Budget 2018, announced a standard deduction amounting to Rs. 40,000 for salaried employees. This was in the place of the transport allowance (Rs. 19,200) and medical reimbursement (Rs. 15,000). As a result, salaried people could avail an additional income tax exemption of Rs. 5,800 in FY 2018-19.

The limit of Rs. 40,000 has been increased to Rs. 50,000 in the Interim Budget 2019.

Leave Travel Allowance

The income tax law also provides for an LTA exemption to salaried employees, restricted to travel expenses incurred during leaves by them. Please note that the exemption doesn’t include costs incurred for the entire trip such as shopping, food expenses, entertainment and leisure among others. You can claim LTA twice in a block of four years. In case an individual doesn’t use this exemption within a block, he/she could carry the same to the next block. Below are the restrictions which are applicable to LTA: 

  • LTA only covers domestic travel and not the cost of international travel
  • The mode of such travel must be either railway, air travel, or public transport

Mobile Reimbursement

A taxpayer may incur expenses on mobile and telephone used at residence. The income tax law allows an employee to claim a tax free reimbursement of expenses incurred.

An employee can claim reimbursement of the actual bill amount paid or amount provided in the salary package, whichever is lower.

Books & Periodicals

Employees incur expenses on books, newspapers, periodicals, journals and so on. The income tax law allows an employee to claim a tax free reimbursement of the expenses incurred.

The reimbursement allowed to an employee is the lower of the bill amount or the amount provided in the salary package.

Food Coupons

Your employer may provide you with meal coupons such as sodexo. Such food coupons are taxable as perquisite in the hands of the employee. However, such meal coupons are tax exempt up to Rs 50 per meal.

A calculation based on 22 working days and 2 meals a day results in a monthly benefit of Rs 2,200 (22*100).
Consequently, the yearly exemption works up to Rs 26,400.

Relocation Allowance

Businesses, these days operate in multiple locations across the country. There are possibilities that you are asked to shift to a different city for business reasons. Such a relocation can cause expenses such as shifting to a new house, moving furniture, car transportation cost, car registration charges, getting your kids admitted to a new school, and more. Fortunately, these expenses are to be borne by the employer. Sometimes, the employer makes a direct payment for such expenses.

Here is a summary of the tax liability of these expenses:

  • Car transportation cost: An employee may incur expenses on transportation of the car to the new place. The employer may reimburse the transportation expenses to the employee against actual bills submitted by the employee. For example, expenses may be incurred on movers and packers. Such expenses whether reimbursed to the employee or directly paid to the transporters are exempt from tax for the employee. 
  • Car registration charges: Most of the states within India charge car registration charges for entry of the vehicle in their state. Certain conditions must be met for the car registration charges to be exempt from taxes. That is, the car must be registered in the name of the employee. The same car must be used to travel on transfer to be considered as part of packaging and transportation cost. Upon meeting the above conditions, any expenses reimbursed by the employer to the employee are exempt from tax for the employee. 
  • Packaging charges: The expenditure on the packaging and moving of the furniture, irrespective of reimbursement or direct payment by the employer, are exempt from tax for the employee. 
  • Accommodation: The employer may provide accommodation facilities for the initial 15 days once you relocate. Such expense will include boarding and lodging expenses including any meals forming part of such expenses. The expenses reimbursed or met by the employer will be exempt from tax for the employee. 
  • Train/air tickets: The travelling expenses for the employee and his family from the current place of residence to the place of new employment are exempt from tax. 
  • Brokerage paid on rented house: If the employee has paid brokerage charges for finding a house for rent, the expenses incurred are considered to be towards personal obligation of the employee. The reimbursed if any received by an employer is taxable as salary income of the employee. 
  • School admission fees: Though your employer reimburses the school admission fees for your kids, this type of expense is considered to be a monetary benefit of the employee. Therefore, the reimbursement is taxable as salary income of the employee. Any expenses incurred beyond the period of 15 days will be taxable.

Children Allowance

The employer may provide you education allowance for your children as part of your salary. Such allowance received by the employer towards children education is exempt from tax.

However, the employee can claim maximum Rs. 100 per month as exemption or Rs. 1200 per annum. The exemption is allowed for a maximum of 2 children.

Allowable Deductions

Section 80C, 80CCC & 80CCD(1)

Section 80C is the most extensively used option for saving income tax. Here, an individual or a HUF (Hindu Undivided Families) who invests or spends on stipulated tax-saving avenues can claim deduction up to Rs. 1.5 lakh for tax deduction. The Indian government too supports a few as the tax saving instruments (PPF, NPS etc.) to encourage individuals to save and invest towards retirement. Expenditures/investment u/s 80C isn’t allowed as a deduction from income arising due to capital gains. It means that if the income of an individual comprises of capital gains alone, then Section 80C cannot be used for saving tax. Some of such investments are given below which are eligible for an exemption under Section 80C, 80CCC and 80CCD(1) up to a maximum of Rs 1.5 lakh.

  • Life insurance premium
  • Equity Linked Savings Scheme (ELSS)
  • Employee Provident Fund (EPF)
  • Annuity/ Pension Schemes
  • Principal payment on home loans
  • Tuition fees for children
  • Contribution to PPF Account
  • Sukanya Samriddhi Account
  • NSC (National Saving  Certificate)
  • Fixed Deposit (Tax Savings)
  • Post office time deposits
  • National Pension Scheme

Medical Expenditure and Insurance Premium (Section 80D)

Section 80D is a deduction you can claim on medical expenses. One could save tax on medical insurance premiums paid for the health of self, family and dependent parents.
The limit for Section 80D deduction is :

  • Rs 25,000 for premiums paid for self/family.
  • Rs. 50,000 for premiums paid for senior citizen parents.
  • Additionally, health checkups to the extent of Rs 5,000 are also allowed and covered within the overall limit.
  • Deduction upto Rs. 50,000 with respect to medical expenditure incurred by the senior citizen (60 years or above) or towards senior citizen parents, provided they are not covered under any mediclaim policy.

The taxpayer can claim maximum deduction of Rs. 50,000 including the premium amount and medical expenditure if he is a senior citizen
(60 years or above). In addition to that if he has paid the medical bills of his senior citizen parents, he can claim additional deduction upto Rs. 50,000.

Your employer may pay premium on your behalf and deduct it from your salaries. Such premium paid is also eligible for deduction under section 80D.

Interest on Home Loan (Section 80C and Section 24)

Another key tax saving tool is the interest paid on home loans. Homeowners have the option to claim up to Rs. 2 lakh as a deduction for interest on home loan for self-occupied property. If the house property is let out, you can claim a deduction for the entire interest pertaining to such a home loan.

Please note that from FY 2017-18, the loss from house property that can be set off against other sources of income has been restricted to Rs. 2 lakh.
In addition to the above, one can also claim the principal component of the housing loan repayment as a deduction under section 80C up to a maximum limit of Rs 1.5 lakh.

Deduction for Loan for Higher Studies (Section 80E)

Income Tax Act provides a deduction for interest on education loans. The significant conditions attached to claiming such deduction are that the loan should have been taken from a bank or a financial institution for pursuing higher studies (in India or abroad) by the individual himself or his spouse
or children.

One may begin claiming this deduction beginning from the year in which the loan starts getting repaid and up to the next seven years (i.e. total of 8 assessment years) or before repayment of the loan, whichever is earlier. Even a legal guardian could avail this income tax deduction.

Donations (Section 80G)

Section 80G of the Income Tax Act, 1961 offers income tax deduction to an assessee, who makes donations to charitable organizations. This deduction varies based on the receiving organisation, which implies that one may avail deduction of 50% or 100% of the amount donated, with or without restriction.

Deduction on Savings Account Interest (Section 80TTA)

Section 80TTA of the Income Tax Act, 1961 offers a deduction of up to INR 10,000 on income earned from savings account interest. This exemption is available for Individuals and HUFs. In case the income from bank interest is less than INR 10,000, the whole amount will be allowed as a deduction.

However, in case the income from bank interest exceeds INR 10,000, the amount after that would be taxable.

Interest on Home Loan (Section 80EE)

Section 80EE allows homeowners to claim an additional deduction of Rs.50,000 (Section 24) for interest component of the home loan EMI. Subject to the following:

  • The loan must not be for more than Rs 35,00,000
  • The value of the property must not be more than Rs 50,00,000.
  • The individual must not have any other property registered under his name at the time the loan is sanctioned.

Tax treatment on Notice Pay and Joining Bonus

Some companies ask you to sign a bond or agreement stating you will serve the company for a specified period of time. If you happen to leave the organisation before completing this period, the organisation may recover the notice pay or the joining bonus paid to you initially.

The tax liabilities for these components are explained with illustrations below:

Illustration I
Notice Pay: Consider that Mr C, with a work experience of 1 year 6 months, was working with Organisation A with an agreement of 2 years. The agreement stated that if he quits the job within the agreement period, he must pay the salary of 3 months as notice pay. Mr C wanted to quit the job and join the Organisation B. The new firm agreed to pay the notice amount so that Mr C could join them sooner. Mr C wants a refund on TDS for the notice pay as he has not received the salary from Organisation 1. In this case, the former organisation must not include the notice pay under the ‘total salary paid’ category in Form 16. This helps Mr C get a TDS refund on the notice pay. If the organisation does not make necessary adjustments in Form 16, Mr C cannot get a refund. 

Illustration II
Joining Bonus: Consider the case of Mr C. Say, he had received a joining bonus of Rs.100,000 from Organisation 1 while joining. Since he has not completed the agreement period, he must pay back the joining bonus while leaving the company. Let us consider that he asks the new company to reimburse the joining bonus for him and the new organisation does reimburse. In this case, Mr C must check the Form 16 given by both the organisations. If Organisation 1 has also included the joining bonus in Form 16, then Mr C will not be able to obtain a refund of the TDS from the income tax department. In this case, the TDS is a dead loss that can neither be recovered or adjusted in ITR.

Exemptions on Perquisites

Cab facility transport provided by employer

Employers generally provide cab facility to and from the office and residence of the employees. Such a facility is not taxed as a perquisite for the employee. The facility would be an expense for the employer.
As per the Indian Income Tax Act, use of any vehicle provided by a company or an employer for a journey by the employee from his residence to his office or another place of work, shall not be regarded as a taxable perquisite, even if provided to him free of cost or at a concessional rate.

Health club facility provided by employer

In the case of a health club facility provided by employer uniformly to all employees, the facility is not taxable as a perquisite in the hands of the employee.

Gifts or vouchers provided by employer

Gifts or vouchers given by an employer in cash or in kind are tax exempt up to Rs 5,000 per year.

Medical expenditure incurred outside India on employee

In a case where the employer incurs expenditure on medical treatment outside India:

  • On the employee
  • Any member of the family of such employee
  • Travel and stay abroad of the employee or any member of the family in connection with the medical treatment
  • Travel and stay abroad of one attendant who accompanies the patient in connection with the medical treatment


Family’ means the spouse and children of the individual. Also the parents, brothers and sisters of the individual or any of them, wholly or mainly dependent on the individual. The above expenditure would be exempt from tax for the employee subject to the condition that –

  • The expenditure on medical treatment and stay abroad shall be exempted only to the extent permitted by the Reserve Bank of India; and
  • The expenditure on travel shall be excluded from perquisite only in the case of an employee whose gross total income, as computed before including therein the said expenditure, does not exceed two lakh rupees.

Example

Let us consider Ravi, an employee who has a CTC of Rs. 10,00,000. In the illustration below, we can understand how to save income tax on salary. Let us examine his salary under two different structures:

 SALARY STRUCTURE 1SALARY STRUCTURE 2
Basic Salary5,00,0004,00,000
(+) HRA3,00,0002,00,000
(+) Provident Fund @12%60,00048,000
(+) Standard Allowance (Conveyance allowance + medical reimbursement)40,00040,000
(+) Leave Travel Allowance30,00030,000
(+) Other Allowances70,0002,82,000
TOTAL10,00,00010,00,000
(-) Exempted HRA2,50,0002,00,000
(-) Standard Allowance40,00040,000
(-) Leave Travel Allowance30,00030,000
(-) Other allowances
• Meal allowance
• Mobile bill reimbursement
• Gift voucher
• Child’s education allowance
• Child’s hostel allowance
• Newspaper/Journal allowance
• Internet Bill reimbursement
 
26,400
10,000
5,000
2,400
7,200
16,000
12,000
Total taxable Salary6,80,0006,51,000
Less: Profession Tax Paid2,5002,500
Less: Profession Tax Paid2,5002,500
Income under the head Salary6,77,5006,48,500
(-) Deductions under Section 80C1,50,0001,50,000
Total Taxable Income5,27,5004,98,500
Tax on income18,72012,920
Saving in tax 5,800


If you were wondering how to save tax on salary, then restructuring it to reflect different exempt allowances is the best way of going about it.

Top 10 Tax Saving Options for Salaried Assessee

With various tax saving options for salaried individuals, you can plan to save tax under the provisions of the Income Tax Act, 1961. These tax planning options for salaried employees provide a platform for the Indian taxpayers to save tax.

Here are the top 10 tax savings options for salaried that are worth knowing:

  • Employees’ Provident Fund (EPF)
  • Public Provident Fund (PPF)
  • ELSS
  • NPS
  • Tax Saving FD
  • Life Insurance Premium
  • HRA
  • LTC
  • Retirement Benefits (Gratuity)
  • Health Insurance Premium


Let’s discuss about some of the top tax saving options stated above in detail:

1. Employees’ Provident Fund (EPF) 

Employees’ Provident Fund, also known as EPF, is one of the most popular tax saving options for salaried people. It was introduced under the Employees’ Provident Fund and Miscellaneous Act of 1952 and is managed by the Central Board of Trustees. 

Under this scheme, both the employee and employers contribute 12% of the employee’s salary to the Employee Provident Fund. On their contributions, the employees receive interest at a specific rate.

Tax savings for salaried employees under EPF comes in the form of tax exemption. The accumulated fund in an employee’s PF account along with interest earned is tax-free.


2. Public Provident Fund (PPF) 

Public Provident Fund, popularly known as PPF, is a tax saving option for salaried individuals that provides a return on the investments, which are free from tax. Being one of the best investment-cum-tax saving options for salaried people, PPF enables them to plan for creating a corpus for retirement and earn guaranteed returns.

PPF investments fall under the EEE or Exempt-Exempt-Exempt category. It means that the amount one invests in a PPF account is tax-deductible under Section 80C and thus, helps in income tax planning for salaried employees. Alongside, the accumulated amount, along with the returns, is exempt from tax when withdrawn from the account. This is one way how salaried person can save tax.


3. Equity Linked Savings Scheme (ELSS) 

Equity Linked Savings Scheme or ELSS is considered one of the best tax saving options for salaried individuals. Investment in ELSS schemes is eligible for deduction from an employee’s taxable income u/s 80C. You should also know that its qualification for tax deduction makes it different from all other mutual fund schemes.

ELSS stands out from other tax saving options for salaried individuals because of its dual benefit – comparatively higher returns, which are partially taxable. After Mar 31, 2018, ELSS returns are taxable at 10% for gains above Rs, 1,00,000.


4. National Pension Scheme (NPS)

National Pension Scheme (NPS) is one of the long-term tax saving options for salaried people in India. It is an investment plan that falls under the purview of PFRDA and the Central Government. People who want to plan for early retirement and have low-risk appetite invest in NPS.

Compared to PPF and Fixed Deposit (FD), NPS investments can provide higher returns but is not equally tax-efficient. Salaried individuals can claim tax benefits under Section 80 CCD (1) within the Rs. 1.5 Lakh ceiling u/s 80CCE. In other words, it helps in income tax planning for salaried employees.


5. Tax Saving FD 

A tax saving Fixed Deposit or FD is quite popular as one of the tax saving options for salaried individuals. It is a type of FD with which you can avail tax deductions on your investments of a maximum of Rs. 1,50,000. The related tax benefits are covered under Section 80C.  

Along with FDs, there are many other tax saving options for salaried people to create wealth. However, tax-saving FD, which has a lock-in period of 5 years, is deemed as the safest option for tax savings for salaried employees.

The returns from FDs are safe but are taxable. It is added under the head ‘Income from Other Sources’ in the ITR and gets taxed at applicable rates. 

6. National Pension Scheme (NPS)

The uncertainties in life call for planning for the financial security of your loved ones under life insurance. While the primary benefit of buying a life insurance plan is to secure the financial needs of your family, you can also avail of tax benefits on such investments.

In fact, buying life insurance is considered one of the most sought-after tax saving options for salaried people. You can use online insurance premium calculator to check how much tax you can plan to save in a financial year. The premiums you pay toward life insurance is tax-deductible u/s 80C, up to the limit of Rs. 1,50,000. Furthermore, the death benefits or survival benefits under these plans are tax exempted u/s 10(10D). As a result, investments in life insurance plans lead to tax savings for salaried employees.


7. House Rent Allowance (HRA) 

Individuals living in rented accommodation can avail tax benefits as per the related rules. HRA or House Rent Allowance (HRA), a part of an employee’s salary structure, is not fully taxable.

What makes HRA one of the tax saving options for salaried individuals is that a part of it is exempted u/s 10(13A) of the Income Tax Act, 1961, subject to certain clauses. The taxable income is calculated after deducting HRA from the total income.

You should also know that HRA received from the employers is fully taxable if you live in your own house and do not pay any rent. This is a crucial aspect you must consider to understand how salaried person can save tax.


8. Leave Travel Concession (LTC) 

Leave Travel Concession or LTC, as the name suggests, is an exemption that salaried employees receive from their employer to travel on leave. Although the tax savings for salaried employees looks simplified under LTC, there are various rules related to claiming LTC exemption. Some of them are:

  • The employees must go on an actual journey to get tax exemption.
  • Only domestic travel expenses are considered under LTC exemption.
  • The tax exemption can be availed on actual travel costs like bus or rail fare, but not on miscellaneous expenses such as local sightseeing.

You should also know that LTC cannot be treated as a tax-free income every year u/s 10(5) of the Income Tax Act.


9. Retirement Benefits (Gratuity) 

Gratuity is yet another option for tax saving for salaried employees. It is given either on superannuation, resignation, retirement, or death or disablement of an employee. Another prerequisite is that the employee must complete a minimum of five years of service with an employer.

The gratuity amount received on any of these eventualities is tax-exempt u/s 10(10), up to the limit of Rs. 20,00,000. Previously, this limit was Rs. 10,00,000 but has been recently increased as per CBDT Notification no. S.O. 1213(E).


10. Health Insurance Premium

Health insurance Plan provides financial security to you and your loved ones in medical emergencies or planned hospitalisation. Besides safeguarding your financial interests, health insurance is one of the most used tax saving options for salaried people.

In general, the premiums paid towards health insurance are eligible for tax deductions, subject to the term of Section 80D. As a part of income tax planning for salaried employees, you can benefit more from this provision by paying for health insurance of your spouse, dependent children, and parents.

The maximum deduction you can avail u/s 80D is Rs. 1,00,000

Frequently Asked Questions:

  • What income am I taxed for?

    Your income is not equal to your salary. You could earn income from several other sources other than your salary income. Your total income, according to the Income Tax Department, could be from house property, profit or loss from selling stocks or from interest on a savings account or on fixed deposits. All these numbers get added up to become your gross income.

    • Income from Salary: All the money you receive while rendering your job as a result of an employment contract. 
    • Income from House Property: Income from house property you own; property can be self-occupied or rented out.
    • Income from other sources: Income accrued from Fixed Deposits and Savings Account come under this head.
    • Income from Capital Gains: Income earned from sale of a capital asset, say mutual funds or house property.
    • Income from business and profession: Income/loss arising as a result of carrying on a business or profession. Freelancers income come under this head.
  • What is TDS shown in my payslip?

    Your employer deducts tax from your salary and pays it to the I-T Department on your behalf. It's called TDS. TDS is tax deducted at source. Your employer cuts a portion of your salary every month and pays it to the Income Tax Department on your behalf.

    Based on your total salary for the whole year and your investments in tax-saving products, your employer determines how much TDS has to be cut from your salary each month.

    For a salaried employee, TDS forms a major portion of an employee's income tax payment. Your employer will provide you with a TDS certificate called Form 16 typically around June or July showing you how much tax was deducted each month.

  • What is Form 16?
    • Form 16 is a TDS certificate. Your employer is required by the I-T Department to deduct TDS on your salary and deposit it with the government.
    • The Form 16 certificate contains details about the salary you have earned during the year and the TDS amount deducted.
    • It has two parts -- Part A with details about employer and employee name, address, PAN and TAN details and TDS deductions.
    • Part B includes details of salary paid, other incomes, deductions allowed, tax payable.
    • Note: Read in detail about what is Form 16 and how you can get your Form 16 here
  • What is Form 26AS?
    • Form 26AS is a summary of taxes deducted on your behalf and taxes paid by you. This is provided by the Income Tax Department.
    • It shows details of tax deducted on your behalf by deductors, details on tax deposited by taxpayers and tax refund received in the financial year. This form can be accessed from the I-T Department's website.
    • Note: Read in detail about what is Form 26AS and how you can get your Form 26AS click here
  • What is Basic Salary?

    This is a fixed component in your pay check and forms the basis of other portions of your salary and hence the name. It is usually a large portion of your total salary. HRA is also defined a percentage of this Basic Salary. Your PF is deducted at 12% of your Basic Salary.

    • Note: To understand the various components in your Pay Slip read here
  • What is HRA?

    House Rent Allowance: Salaried individuals who live in a rented house/apartment can claim House Rent Allowance or HRA to lower taxes. This can be partially or completely exempt from taxes. The allowance is for expenses related to rented accommodation. Note: If you receive HRA and dont live on rent your HRA shall be fully taxable. To understand about the other components in your Pay Slip read here

  • What is the due date for return filing for individuals?

    Individuals need to file their return by 30th September of next year, i.e for income earned in Financial Year 2015-16, the return has to be filed by 30th September, 2016.

  • What is income from house property and how is it taxed?

    Income from House Property is possible in these cases –

    • Rental Income on a let out property
    • Annual Value of a property which is ‘deemed’ to be let out for income tax purposes ( when you own more than one house property)
    • Annual Value of the property which is self occupied, which is Nil
    • Under section 24 of the Income Tax Act you are allowed to make certain deduction from the Net Annual Value of your House Property. Net Annual Value is Gross Annual Value less Municipal Taxes Paid. In case the property is let out, its rent received is your Gross Annual Value, whereas in case of a deemed to be let out property, a reasonable rent of a similar place is your Gross Annual Value. For a self occupied house property the Gross Annual Value is Nil. Read more about House property income and its taxation Here
  • Can I file a revised return to correct a mistake in original return filed?

    Yes, return can be revised within a period of one year from the end of the relevant assessment year or before completion of the assessment whichever is earlier. Filing of revised return is not part of the plan. Plan buyer is required to provide full and accurate details to avoid the need for any rectification in the originally filed return.

  • Can a return be filed after the due date?

    Yes, a belated return can be filed before the end of the assessment year or before completion of the assessment year, whichever is earlier. For example, in case of income earned during FY 2016-17, the belated return can be filed up to 31st March 2018. ​

  • Am I required to keep a copy of the return filed as proof and for how long?

    Yes, under the Income-tax Act legal proceedings can be initiated up to 4 to 6 years (depending upon case to case) prior to the current financial year. However, in certain cases the proceedings can be initiated even after 6 years, hence, it is advised to preserve the copy of return for at least 6 years or maintain it as long as possible.

  • Do I need to attach details of TDS deducted, proof of investments etc?

    ITR return forms are attachment less forms and hence, you are not required to attach any document (like proof of investment, TDS certificates etc.) along with the ITR (whether filed manually or electronically). However, these documents should be retained and produced before the tax authorities when demanded in situations like assessment, inquiry etc.

  • Are Audit and Financial statements preparation covered in the plan?

    Audit & preparation of financial statements is not part of the plan.

  • Is revised return covered under the plan?

    Revised return filing on account of incorrect information provided by the assessee during the original return filing shall not form part of the plan.

  • What is the cancellation / refund policy?

    Refund is applicable only if no CA has been assigned on the case, for detailed policy please visit our terms of use