ECONOMICTIMES.COM|
Mar 28, 2017, 01.30 PM
IST
Effectively, four working days are left for the end of the
financial year 2016-17. Although the Reserve Bank of India has directed banks
to remain open on all days till April 1, 2017 to facilitate government receipt
and payment functions including collection of taxes, for a taxpayer, the March
31 deadline remains sacrosanct as all tax related tasks need to be completed by
then.
Waiting for the last bus
If you are contemplating to take up the tax
matters at the last minute, there could be bad surprises in the offing. Say, a
taxpayer invests through a cheque on March 30 (or even on March 29), but the
payment doesn't go through for some reason, say, wrong date or signature
mismatch, and by the time the taxpayer rectifies the mistake, it's the new
financial year (FY), i.e., 2017-18. Something may go wrong when it comes to
online payments too if things are left to the last minute.
Here are few tax-related matters to attend to
now so that they can be wrapped up by March 31.
Filing tax returns
If you are one of those taxpayers who has not
filed income tax returns (ITRs) in time, March 31 could be the last date for
some of you, depending on the FY that you wish to file for. Archit Gupta,
Founder & CEO, ClearTax.com, says, "In one financial year, you can
file your IT returns for the previous two financial years. So, in FY 2016-17,
you can file returns for FY 2015-16 and FY 16-17. Returns for FY 2014-15 cannot
be filed after March 31, 2017."
If tax remains to be paid
If you are filing ITR for any previous year,
make sure you are adding interest on the unpaid tax, if any. Under Section 234A
of the I-T Act, interest is levied for delay in ITR filing. The taxpayer is
liable to pay simple interest at 1 per cent per month or part of a month for
delay in filing ITR. Gupta informs, "To avoid penal interest on tax dues,
one must pay all taxes by March 31. However, if advance tax applies to you and
you didn't deposit t advance tax as per instalments, interest under section
234C may still apply to you. Businesses covered under presumptive income scheme
must also make sure the deposit all their tax dues by March 31."
More than one employer
If an employee switched jobs in 2016-17, he
needs to inform the present employer about the details of income, provident
fund (PF) contributions, Section 80C, leave travel allowance (LTA), etc.,
already made with the previous employers. In fact, this should be done at the
time one joins the new job, and by March 31 in any case. Information about
salary earned from the previous employer and tax deduction at source (TDS) can
be communicated to The current employer by using Form 12B. Besides, one can
make disclosures about tax deductions one wants to claim in Form 12BB to their
current employer, says Gupta.
Complete your tax savings
The tax saving investments done in FY 2016-17
will help you lower your tax liability for the year. Choosing the right tax
saver may not be an easy task for all, hence do not wait till March 31. Click
here to find out the right tax saver that suits you.
Ensure continuity
Several tax savers such as PPF, National Pension
Scheme (NPS), etc., require a minimum amount to be deposited each year in order
to keep them active. Else, one would have to pay the unpaid amount along with
penalty to make them active again. Make sure you deposit the requisite minimum
amount in them by March 31. Ideally, putting in the minimum amount doesn't help
much in meeting long term goals. It's better to link one's investment to a goal
and invest invest the estimated amount accordingly and not just pay the minimum
amount as it doesn't help in the long run in meeting the goal.
While PPF require a minimum deposit of Rs 500 a
year to keep it active, the minimum yearly contribution for NPS (Tier I) is Rs
1,000, excluding charges and taxes, but for Tier II, there is no minimum
contribution requirement for the financial year. Tier I also requires at least
one minimum number of contribution in a year. Keep a tab on these minimum
limits as it can be changed at any point of time by the government.
Informing your employer
For salaried individual, merely making a tax
saving investment may not be enough. One needs to submit documentary evidence
of the same to the employer. Most employers have a cut-off date for such
submissions, which could be anytime between January and February 2017. For
those who have made tax saving investment after the employer's cut-off date,
the same can be shown while filing ITR. Here is a recap of things to inform
your employer.
Investments
made on ad-hoc basis have high probability of not giving the desired results.
From the start of the next FY, prepare a plan in advance, taking care of your
tax savings requirement and the goals to achieve. Unless you begin now, March
31, 2018 will not be any different from what it is this year.
Read more at:
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