The Financial Year end is round the corner, and shortly, all employees are required to submit the investment proofs for the year 2015-16. Since the Income tax department made it very clear to all employers to verify the geniuses of each claim made by the employee (circular 20/2015), the document verification will be more stringent from the employers as considered to the previous period.  Employers have the right to define the guidelines in accordance, with more controls and riders, with the income tax rules, to safeguard the interest of the organization.

DDOS TO SATISFY THEMSELVES ABOUT THE GENUINENESS OF CLAIM:

“The Drawing and Disbursing Officers should satisfy themselves about the actual deposits/ subscriptions / payments made by the employees, by calling for such particulars/ information as they deem necessary before allowing the aforesaid deductions. In case the DDO is not satisfied about the genuineness of the employee’s claim regarding any deposit/ subscription/ payment made by the employee, he should not allow the same, and the employee would be free to claim the deduction/ rebate on such amount by filing his return of income and furnishing the necessary proof etc., therewith, to the satisfaction of the Assessing Officer”

A generic guidelines for the investment document submission is as follows, employers still have right to add more riders to it.

 Taxation Section Guidelines
 Rent Payments

 

 

 

Monthly rental receipts

Following information is mandatory in the rent receipt.

Landlord’s name and address, signature of the Landlord.

Landlord’s PAN or a self-declaration, in case the annual rent amount is greater than 1.0 lakh.

Revenue stamp to be affixed for the cash payments.

Loss on self-occupied property and HRA exemption should be allowed in the same city- (Ref: Notification 20/2015).

 Interest on Housing Loan- Self Occupied Property. Interest certificate from the bank/financial institution with the total interest and principal paid/due for the FY.

Completion certificate of the house property from the builder or

Self-declaration from the employee with the details of occupation.

Income / Loss from House Property- Let out Property

 

 

 

 Interest certificate from the bank/financial institution with the total interest and principal paid/due for the FY.

Completion certificate of the house property from the builder or

Self-declaration from the employee with the details of occupation.

Detailed calculation of Let out income/loss.

 Insurance Premium/ULIP/Pension scheme.  Premium receipts paid during current financial year, in name of self, spouse, children.
 National Saving Certificate (NSC)  Copy of NSC certificate in the name of employee.
 Public Provident Fund- PPF  Copy of the stamped deposit receipt, paid during current financial year or

Copy of the Passbook with clear mention as PPF Account.

 Interest accrued on N S C deposited in the earlier FYs.  Copy of the NSC’s purchased in the previous FYs.

Interest accrued will be considered as other income too.

 Tax Saving Mutual Funds  Copy of investment certificate with the employee name, Investment Date, Amount, Type of Investment.

Only the investments made under Tax Saving Fund / Plan will be considered

 ELSS  Copy of investment certificate with the employee name, Investment Date, Amount, Type of Investment.

Only the investments made under Tax Saving Fund / Plan will be considered.

 Children Tuition Fees. Copy of Tuition Fees paid to educational institution.

Payment in nature of Donations, Capitation fees, Uniform fee, Sports fee, Van Fees, Shoes & Sock etc., are not allowed.

 Principal Repayment of Housing Loan  Same as interest on housing loan mentioned above.
 Post Office –Term Deposit with more than 5 year term.  Copy of deposit receipt.
 Tax Saving Fixed Deposits with Scheduled Banks.  Copy of Deposit Receipt invested during current financial year, qualified benefit under Sec 80C of the Income Tax Act.
80CCG – RAJIV GANDHI EQUITY SAVINGS SCHEME

The investment is made in listed equity shares/Mutual funds.

Deduction is limited to 50% of the amount invested in such equity shares subject to a maximum of Rs.25000/-

 Mandatory info.

Gross Total Income of the employee for the financial year shall not exceed twelve lakh rupees.

The employee should be a new retail investor as specified under the scheme.

Copy of the Form A submitted with the Depository Participant duly acknowledged.

Self declaration from the employee duly attested by the Depository Participant.

 MEDICLAIM – Deduction U/S 80 D – including preventive health check up.

Employee, spouse, dependent children, and parents.

 Copy of premium receipt paid during the FY.

Receipt of payment of preventive health check-up of the employee or family.

Medical Treatment on Handicapped Dependant – Deduction U/S 80 DD

 

 

 Proof of

a. Expenditure incurred towards medical treatment, training and rehabilitation of a handicapped dependent ., or

b. Amount paid or deposited under any scheme framed in this behalf by the LIC or UTI or any other insurer and approved by the Board for the maintenance of the handicapped dependent

c. Form 10-IA.

Medical Treatment Expenses for the specified disease  – Deduction U/S 80DDB  Medical Bills / expenditure incurred by way of medical treatment for a specified disease along with a certificate from a hospital in the prescribed form.

Form 10-I

 Interest paid on Higher Education Loan – Deduction U/S 80 E  Copy of Bank certificate stating that the loan and interest has been paid and amount payable during the financial year.

 

 For Self – Permanent Disability – Deduction U/s 80 U  Form 10 I-A
NPS – 80CCD(1B) Copy of the stamped deposit receipt, paid during current financial year and copy of the Passbook with clear mention as NPS Account.

Employees who joined after 1st April 2015 to the current organization, are requested to submit their previous employment income and compute the consolidated tax liability for the year. In absence they will liable to pay the differential tax with 18% interest, while filing their personal return with income tax department.

(Benny Thadathil-  bennythadathil@gmail.com)

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One response to “Guide to Submit Investment proof to your Employer”

  1. Lourdes says:

    Can employer store the investment documents in soft copy? Is it permissible as per IT rules?

  2. Anonymous says:

    I had paid off my higher education loan in the year 2013-2014. However, the same was not submitted for IT returns. Can I include the same to get the returns in FY 2015-2016?

  3. Reddyy says:

    If I work in Pune by staying temporary hotels and I am paying rent for My house in Bangalore where my family stays and I will go home 3days week, then shall I claim HRA for the rent I paid in Bangalore, which is my official recidence.

  4. Benny says:

    No, interest can be claimed only after occupation of the house.
    Pre-emi can be claimed over 5 years from the year of occupation.

  5. Neeraj Chauhan says:

    I’m paying Pre-EMI of house loan, is it also an exemption in income tax return

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