Balwant Jain

Though the due date for filing of your income tax returns is extended till 31st August 2015, I thought of writing about a few things which you as a tax payer should do before you actually sit down to prepare your income tax return yourself or visit your CA’s office. Even if you do not intend to file your return by 31st August, there are certain things which you should do before you the due date which is 31st July generally but is 31st August for this year.

VERIFY THE FORM NO. 26AS

The present system does not allow you to attach any physical document with your income tax returns. Therefore the credit for TDS and taxes paid is given on the basis of data available with the income tax department. Such data of TDS/taxes are collected by the income tax department thought returns of TDS filed by the person deducting the tax or the banks where you have deposited your tax. Due to some mistake on the part of either the bank or the person deducting the tax some error might have crept in and the proper credit for TDS/tax is not reflected in the statement of your tax credits i.e. form No. 26AS.

Now you can view your form no. 26AS either through your internet banking login or through login to income tax web site. Please verify that all the tax deducted/collected/paid by you is correctly reflecting in form No. 26AS. Verify the same from the from no. 16 and 16A received by you. In case of any discrepancy, take up the matter with the concerned deductor or the bank where you had deposited the tax and take appropriate steps to ensure that the errors are rectified so as to ensure that true tax credit is reflected in the form no. 26AS. This will ensure you proper credit at the time of processing of your return.

VERIFY THE FORM NO 16 /16A

By now all of you must have received your Form No. 16. So you should verify that the details furnished in form no.16 is correct. Please verify that your PAN correctly mentioned on this or you will not get the credit for the TDS.

In addition to verifying PAN it is equally important that all the exempt allowances like HRA, Medical reimbursement, LTA etc, in respect of which you have already submitted documentary evidence are shown as exempt in the form. There may be some discrepancy due to you having submitted the documents at the fag end and the same having not been taken cognizance of. Do not forget to verify the amount of various deductions available to you, for LIP, health insurance premium, home loan repayment, interest on education loan, school fee etc, are properly mentioned in the form no 16.

It is very important to verify the details in form no. 16 since your tax consultant will rely on the figures as per the form no. 16 and may not realize that some exempt allowances have been treated as taxable in form no. 16. In case there is any such discrepancy, please bring it to the notice of your employer and request them to get the data corrected appropriately.

In case excess tax has been deducted due to any reason though your employer can not refund you the excess tax so deducted, you can claim refund for the excess tax deducted from your salary in the return of income being filed now.

Similarly verify the form no. 16A received from bank etc for correctness as regards PAN number, amount of income shown and amount of TDS mentioned on it.

Open the capital gains account before 31st August 2015

There are certain things which you should do by the due date of filing of your return even if you are not able to file your income tax return by the due date. This is opening of capital gains account which is required to be done by the taxpayers who have sold earned some taxable long term capital gains and have planned to avail tax exemption by investing in a house.

As per Section 54 of the Income Tax Act, if you have sold your residential house property in the last year which was held for more than 36 months, you can save the long term capital gains tax by investing the capital gains for purchase or construction of another residential house within specified period. Likewise if you have sold any other long term asset other than a residential house property, you can save your income tax by investing the net consideration in another residential house property within specified time limits.

Though the law provides for longer period for making investments, the law also that if you have not been able to invest the required money fully by the due date of filing of the income tax return, you have to deposit the unutilized money in the capital gains account with specified bank before you actually file your return by the date. However if you are not able to file your income tax return by the due date, please ensure that you open the capital gains account and deposit the money unutilized by 31st August 2015, so as not to lose your exemption.

Hope the above discussion will help you better prepare for filing of your income tax return.

(Balwant Jain is a CA, CS and CFP. Presently working as Company Secretary of Bombay Oxygen Corporation Limited. He can be reached at jainbalwant@gmail.com)

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0 responses to “Prepare for filing of your income tax returns”

  1. CA. Subhash Chandra Podder says:

    good article , keep it up.

  2. C.Gopala Rajan says:

    Thanks a lot & this is very useful information

  3. vsnmurty says:

    Dear Professionals,
    Tds deducted but not paid by the deductee?

    Circular 275/29/2014-it-(b) DT.01-06-2015 may be of some help besides Sec.205 of IT Act 1961

  4. AMP says:

    What recourse do I have if someone has deducted TDS while issuing payment to me but has not deposited the same with Income Tax and hence this amount is not appearing in my Form 26AS?

  5. Avadh Kishore Sharma says:

    Good Article.

  6. Mahesh Chander says:

    Thanks … this is useful information

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