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Old 11th July 2016, 11:53   #886
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Default Re: All Income Tax Queries (refunds, disputes, rates etc...)

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Originally Posted by bond_bhai View Post
Hey Guys, How do i declare SB account interest? I know there is a field for this, but it says "Fill up TDS2 Schedule" - Do i need to get Form16/16A from Bank for this?
Banks issue Form 16A only if they actually deduct tax at source, if I recall correctly. You just need to fill in the total savings account interest earned during the FY (but note that some banks credit the interest on April 2 or so, but you accrue that interest in the previous FY). Both spreadsheet and Java versions compute tax only on interest in excess of 10K.
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Old 11th July 2016, 12:19   #887
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You just need to fill in the total savings account interest earned during the FY (but note that some banks credit the interest on April 2 or so, but you accrue that interest in the previous FY).
Thank you @binand! So, i just input the total amount in the "Income from other sources" and file the returns? No need for TDS2 and such - right?
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Old 11th July 2016, 13:42   #888
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Thank you @binand! So, i just input the total amount in the "Income from other sources" and file the returns? No need for TDS2 and such - right?
Yep, you just have to fill the amount in the head "Income from other sources".
Also mention the same amount in Deductions column in 80TTA. As interest upto Rs. 10000 from saving bank is exempt from tax.
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Old 13th July 2016, 14:26   #889
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Default Re: All Income Tax Queries (refunds, disputes, rates etc...)

Folks - some expert advise needed on the following

For folks who have exempt allowances under Sec 10 like HRA, LTA etc which adds up to a significant amount, can they still file returns using ITR 1? ITR 1 has only one cell which asks the taxpayer to capture all exempt income (and mentions that for agri income >5000 ITR 2 to be used). Assume that in this case, there is no more than one house income, neither CG, nor income from lottery foreign sources etc

ITR 2 on the other hand has a detailed sheet in a separate tab (excel utility) which captures all the exempt allowances under specific headings.

It seems that there is no clear direction from the authorities themselves whether any and all exempt income above Rs 5k should be filed using ITR 2

thanks in advance
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Old 13th July 2016, 16:17   #890
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Originally Posted by hothatchaway View Post
For folks who have exempt allowances under Sec 10 like HRA, LTA etc which adds up to a significant amount, can they still file returns using ITR 1?


thanks in advance

If your employer has already considered these exempt incomes in your Form 16, then you can use ITR 1 and you don't need to show these income in the form. Otherwise, use ITR 2 for claiming these exempt income from total income.
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Old 13th July 2016, 16:56   #891
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Default Re: All Income Tax Queries (refunds, disputes, rates etc...)

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If your employer has already considered these exempt incomes in your Form 16, then you can use ITR 1 and you don't need to show these income in the form. Otherwise, use ITR 2 for claiming these exempt income from total income.
Thanks for the quick reply, my question is that in form 26AS, the total amount under head 'salaries' is captured which includes the exempt income also (but not a break up). The form 16 does call out the exempt income separately but then one is not required to attach that to the ITR while filing. If there is a scrutiny post filing between form 26as and the ITR 1 (where you capture the salary amount net of exempt allowance) will not there be a discrepancy?

I understand there is one cell in ITR 1 where one can mention exempt income, but that would be an overall amount also including items like tax free interest from PPF etc
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Old 13th July 2016, 18:31   #892
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Originally Posted by hothatchaway View Post

For folks who have exempt allowances under Sec 10 like HRA, LTA etc which adds up to a significant amount, can they still file returns using ITR 1? ITR 1 has only one cell which asks the taxpayer to capture all exempt income
Yes. You use ITR 1.



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... 2 on the other hand has a detailed sheet in a separate tab (excel utility) which captures all the exempt allowances under specific headings.

Makes no difference.

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seems that there is no clear direction from the authorities themselves whether any and all exempt income above Rs 5k should be filed using ITR 2
you are being likely mislead by info at least 2 years old.

Till 2 years back, you had to use ITR-2 if exempt income exceeded 5K. I remember using that form - Only once. That year, the Java utility did not accept figure in excess of 5K. I had only 7K to declare.

For current Ay - 2016.17- I used ITR 1 and declared 32k exempt income - 2k from Savings a/c interest, 9K from FD a/c , and rest long term capital gains. I used the official Java based utility to prepare & file the return online. Last year too, with about 20 k exempt income, and filed the XML generated by the Java utility to file online.

HTH.
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Old 13th July 2016, 19:04   #893
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Thanks for the quick reply, my question is that in form 26AS, the total amount under head 'salaries' is captured which includes the exempt income also (but not a break up). The form 16 does call out the exempt income separately but then one is not required to attach that to the ITR while filing. If there is a scrutiny post filing between form 26as and the ITR 1 (where you capture the salary amount net of exempt allowance) will not there be a discrepancy?



I understand there is one cell in ITR 1 where one can mention exempt income, but that would be an overall amount also including items like tax free interest from PPF etc

26AS does not give the details of taxable salary computation but just net salary paid to an employee for the period covered. Thus, one doesn't need to worry about this figure in AS26 as far as salary is concerned. Form 16 generated from Traces website (not the one manually prepared) is sacrosanct and base your ITR1 on that form. If section 10 exemptions are already factored by your employer, don't show them once again in ITR1. If and if only these are not factored by your employer, that these should be shown using ITR2.
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Old 13th July 2016, 21:54   #894
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Default Re: All Income Tax Queries (refunds, disputes, rates etc...)

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Income from PPF is same as income earned from Tax free Fixed Deposit. You have earned the PPF interest income its just that you are not withdrawing it. So you have to report it every year in your return form in the EI column.
Does the same apply to PF (the one maintained by EPFO) as well? I believe yes going by the explanation for PPF.

This point on EPF/PPF interest declaration has been a point of debate for quite some time now. Hope IT Dept will issue a proper clarification on this topic on their website.
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Old 13th July 2016, 23:29   #895
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Does the same apply to PF (the one maintained by EPFO) as well? I believe yes going by the explanation for PPF.

This point on EPF/PPF interest declaration has been a point of debate for quite some time now. Hope IT Dept will issue a proper clarification on this topic on their website.
For the F.Y. 2015-16 it is the same. For the current year for which you'll have to file return next year clarifications from CBDT are needed.
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Old 14th July 2016, 12:02   #896
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Default Re: All Income Tax Queries (refunds, disputes, rates etc...)

I am going to file the return this weekend - need to spend time on the 'capital gains' part - since I redeemed some mutual funds in 2015-16.

Last year, I spent a lot of time filing ITR -2 and had anxious moments since it took more than 6 months for the 'verification' from IT department.

Now, I see in my Form 26AS, only 1 bank has put an entry.
What does this actually mean?
Bank did not pay me Rs. 2566.
But I do see that my FD had matured and I received an interest of 10721 (approx.) on that day.

So, do I consider that bank has cut the money as TDS but not paid to IT department?
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Old 14th July 2016, 12:08   #897
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Default Re: All Income Tax Queries (refunds, disputes, rates etc...)

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So, do I consider that bank has cut the money as TDS but not paid to IT department?
No, the bank hasn't deducted anything and hasn't paid the government anything. Both those columns are 0 (last two columns).
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Old 14th July 2016, 12:11   #898
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Default Re: All Income Tax Queries (refunds, disputes, rates etc...)

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No, the bank hasn't deducted anything and hasn't paid the government anything. Both those columns are 0 (last two columns).
Thanks.


So, why is the bank telling something to IT department?

No other bank has done that for me.
And I am curious what is the amount of Rs 2566 supposed to mean?
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Old 14th July 2016, 12:23   #899
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Default Re: All Income Tax Queries (refunds, disputes, rates etc...)

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So, why is the bank telling something to IT department?

No other bank has done that for me.
And I am curious what is the amount of Rs 2566 supposed to mean?
I think nowadays they have to report everything. The thing is, the 10k exemption is across all banks. You could theoretically earn 9k interest each from 10 banks and not have any TDS. IT department wants to know about this situation and charge you interest and penalty of applicable.

2566 could be the part of 10721 attributable to that financial year. Without knowing the terms of your FD (amount, duration, interest rate, interest period etc.) it is tough to validate.
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Old 14th July 2016, 12:24   #900
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Default Re: All Income Tax Queries (refunds, disputes, rates etc...)

This is for my relative.

He had joined an organisation few years earlier and then resigned. He has the resignation letter with him. But the organisation offered him to be an on-roll employee for the whole year (April 2015 to March 2016) for some per month cash consideration. No documentation was done and neither my relative signed any of the document.
The oral word was that they will credit the salary which comes to around 3 lakh rupees for the whole year against his PAN number and will pay him the extra tax liability which he will incur due to this in cash at the time of filing the return. They had so far deposited Tds of just Rs. 7000 and had credited 3 lakhs as salary u/s192. The salary wasn't actually credited to his Bank account. Its just showing in his Form 26as.
And now they saying that you deposit the tax first and then they will pay him after few month.
Needless to say my relative is slowly beginning to lose trust on them and now looking for other options.

So my query.
Is it possible that he tells the tax department that the Rs. 3 lakhs which have been credited against his PAN number are due to a mistake by the very same organisation in which he was an ex employee and also no salary amount was credited to his bank account.

What is the procedure for the same. Any advices?

His other income includes Income from professional services only.
TIA.

Last edited by Sherlocked : 14th July 2016 at 12:29.
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