TAX TALK-11.06.2012-THE HITAVADA
TAX TALK-11.06.2012-THE HITAVADA
TAX TALK
BY CA. NARESH JAKHOTIA (Chartered Accountant)
“RECEIPT OF SALARY
IS NOT THE CRITERIA FOR ITS TAXABILITY”
Query 1]
The Quarterly TDS certificates are sent by the
Companies/Banks by post or courier. But for some reason or other, if it is not
received, then involves unnecessary follow up with the companies. To avoid this,
can I use TDS-data/information like TAN of Deductor etc reflected in Form
26-AS, for filing Income Tax Return. Please advice in the matter. [vdpankey@rediffmail.co]
Opinion:
Assessee can file the Income
Tax return on the basis of TDS credit reflected in Form No. 26AS rather than
waiting for the TDS Certificate from the concerned Deductor. Now, the income
tax department is also relying mainly on the amount reflected in 26AS for
granting TDS Credit to the assessee. However, it is advisable to get the copy
of the TDS certificate for record purpose as the option of filing the revised
TDS return is always available with the Deductor.
Query 2]
I need some clarification about the Senior Citizen
saving account scheme. Last FM Shri Chitambaram in his last or a year earlier
brought this scheme/ instrument under 80C is his budget proposal.
Should I conclude that:
1. The
investment & the interest accrued are free of Income tax as covered by section
80C?
2. Should
interest be a part of Income & also be a part of items covered under 80C or
a part of section 80C only?
3. In case of Bank
FD' for 5 years, the interest is exempt. Since the investment in this scheme is
for 6 years or more, is the interest accrued also exempt from IT?
4. Whether the interest income from senior citizen
deposit account scheme will be subject to tax deduction? [shivdev_gupta@hotmail.com]
Opinion:
1.
Investment
in an account under the senior citizens Savings Scheme Rules-2004 is eligible
for deduction u/s 80C.
2.
The
Interest income on deposit made in the Senior citizen saving scheme is not eligible
for deduction u/s 80C.
3.
Interest on specified
Bank FD with a 5 years term is taxable (& not exempt as mentioned in the
query) Similarly, Interest on amount deposited under the Senior Citizens Savings
Scheme, 2004 is also taxable.
4.
Interest payable
on the amount invested in the senior citizen deposit account scheme is subject
to deduction of tax at source (TDS). Interest payment has not been exempted
from deduction of tax at source. (GOI letter F. No.2/8/2004/NS-II dated March
28, 2006)
Query 3]
Kindly guide me in the
following matter regarding non payment of salary even after deducting TDS from
salary. I have Resigned from the private company after giving one month notice
as per agreement/bond & was relieved on 10th of March 2012.
Company has deducted TDS from my salary of March-2012 (10 days salary) &
did not pay the balance salary (i.e., total salary less TDS).
1. Kindly
guide me whether company has right to hold back the net salary after effecting
the TDS payable for the month of March 2012? Is there any provision under IT
rule compelling the company to make the payment of balance salary once the TDS
is deducted from it?
2. Also
guide me how to file the return as Form No. 16 will show total amount paid but
actually not received the above mentioned 10 days salary till date as
the TDS is deducted on this 10 days salary of March? [D.R.P. -*_******@yahoo.in]
Opinion:
1.
Basis of charge in respect of salary income is fixed
by section 15 of the Income Tax Act-1961. It is chargeable to tax either on due
basis or on receipt basis, whichever matures earlier. It may be noted that
receipt of salary income is not the criteria for its taxability. 10 days salary is taxable as your income whether the
same is received or not. There is no provision in the Income Tax Act that can
compel the company to make the payment of the salary even if the TDS is done on
that salary.
2.
You have to incorporate
the 10 days salary, as reflected in Form No. 16, as income in your income tax
return.
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