How to address change in gross income given by employer on Form 16

Ans: You can rectify errors made in income tax filing even after you finish filing under section 139 (5) and you can do refiling. This revised return can be filed before three months prior to the end of the relevant assessment year or before the completion of the assessment. So, the last date for you to to file a revised return using both the form 16 for FY 2021-22 (AY 2022-23) is December 31, 2022, for ITR filed for FY 2021-22.

When you do re-filing, you are supposed to select the option ' Revised u/s 139(5)' in the 'return filed under' column. The ITR form will additionally ask you for details of the original ITR, i.e., receipt number and date of filing of original ITR.

Since you have 2 Form 16s, after uploading the first Form 16, you need to click on ‘upload another Form 16’ and submit so that both Form 16s gets uploaded.

I must highlight that normally when you have 2 Form 16s there would be additional tax payable due to double count of various exemption limits and deductions in each Form 16. You would end up paying interest on the additional tax as well.

Ans: In a financial year the following are taxable under salary:

1. Amount received as salary in FY
2. Amount due as salary in FY, whether received or not
3. Any arrears of salary received (if not taxed in previous FY)

If the TDS is not confirmed in 26AS, that means the employer has deducted taxes while paying you the salary but has not deposited the same with the I-T department.

You need to keep your salary slips, bank statements and Form 16 carefully and submit it as proof, if required.

You can continue to pursue your employer for payment of the additional month's salary that has not been received by you.

Ideally, you can file returns for 12 months, as per the Form 16 provided to you.

Finally, if your issue is not resolved and your 26AS continues to not show the TDS, you can write a detailed mail with backups to the assessing officer and keep it as proof.

 

Ans: Hello Devendra,

If there's a change in your gross income that impacts the details you've provided in Form 15G or 15H, you should inform your employer or the entity that's deducting the TDS. You may need to submit a new Form 15G or 15H with the updated income details.

Remember, these forms are used to declare that your income is below the taxable limit and that no TDS should be deducted from your income. If your income changes and it's now above the taxable limit, it's important to update this information to avoid any issues with the Income Tax Department.

Please consult with a tax advisor or chartered accountant to ensure you're following the correct procedures. This is just a general advice and the actual process may vary based on your specific situation.

I hope this helps!

Ans: When filing your Income Tax Return (ITR-1) after retirement, you'll need to account for your income from Provident Fund (PF) and Gratuity. Here's how you can handle these components:

Provident Fund (PF):

• PF withdrawals are taxable if you have not completed five years of continuous service. However, if you've been employed for five years or more, PF withdrawals are tax-exempt.
• If your PF withdrawal is taxable, you should report it under the head ‘Income from Other Sources’ in your ITR-1 form.
• If your PF withdrawal is tax-exempt (due to more than five years of continuous service), you don't need to report it in your ITR as taxable income.

Gratuity:

• Gratuity received by an employee on retirement is exempt from tax up to a certain limit as per the Income Tax Act.
• The exemption for gratuity is calculated based on the formula: (15/26) * (last drawn salary) * (number of years of service).
• The maximum exemption limit for gratuity is Rs 20 lakh, as per the latest tax laws.
• If the gratuity amount you received is within the exemption limit, you don't need to report it in your ITR as taxable income.
• However, if the gratuity amount exceeds the exemption limit, the excess amount is taxable and should be reported under the head ‘Income from Salaries’ in your ITR-1 form.

Here's how you can report these incomes in your ITR-1 form:

• If both your PF withdrawal and gratuity fall within the exemption limits, you don't need to report them in your ITR-1 form.
• If any part of your PF withdrawal is taxable, report the taxable portion under ‘Income from Other Sources.’
• If any part of your gratuity is taxable (i.e., exceeds the exemption limit), report the taxable portion under ‘Income from Salaries.’

Remember to keep all relevant documents, such as Form 16, PF withdrawal statement, and gratuity payment details, handy while filing your ITR. If you're unsure about any specific details or calculations, consider consulting a tax advisor or chartered accountant for personalised guidance.