Tax Saving Plans

Ritikashah11998 Ritikashah11998

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• Publié par: Ritikashah11998
• Publié le: 08 avril 2016
• Nombre de lectures: 2
• Langue: English

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Have you paid tax on your interest income?

Preparing to file your tax return? Make sure you have included all the interest income earned during the year. Although interest earned from infrastructure bonds, fixed deposits and recurring deposits is fully taxable, taxpayers often ignore this income in their returns. "This is a common misconception. There is also a misconception that there is no need to report the income if the bank has deducted TDS. But TDS is only 10%, and if your income puts you in the 20% or 30% tax bracket, you have to pay additional tax. Of course, if the income is below the basic exemption limit, the TDS will be refunded when the investor files his return.

While Form 26AS shows only the TDS, the department can also track other deposits and interest payments received without TDS. "Information regarding interest earned by individuals and business entities on term deposit is filed with the Income Tax Department by banks including co-operative banks and other financial institutions and state treasuries," warns the circular.

Tax payers should also note that the 10-figure alphanumeric PAN is under constant surveillance by the department. Almost every financial transaction requires PAN.

If you don't mention that TDS (and the income on which it was deducted) in your tax return, the computerized surveillance system in theTax Saving Plans

department will immediately pick up the discrepancy. "Last year, the tax department sought information of all bank accounts held and taxpayers should not forget to include saving account interest from all of these in their tax returns.

Source: https://www.bajajallianzlife.com/save-tax.jsp