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Making your claim at the time of filing income tax return
September, 15th 2012

One of the main questions for individuals is whether they can claim tax benefits that have not been considered by their employers during the course of the year while paying salary.  There are a lot of deductions that are available for the individual but often due to some procedural error or non submission of the details in time these are not considered by their employer while making the tax deduction. In such a situation the employee is worried whether they will be able to claim the benefits later or whether the tax department will just consider the details that are provided in Form 16 and not allow any further benefits. Here is a closer look at the entire issue.

Losing out

There is usually a time limit for the purpose of submission of the details of the investment made by the individual during the year as well as giving the actual proof that the process has been completed. In case of the latter many companies have January or February end as the time by which this has to be completed. In such a situation not everyone is able to complete this by the time provided by the employer though they would still manage to finish the process before the end of the financial year. The implication of this move is that the individual is not able to claim the benefit of the deduction in the Form 16 and the consequence of this is that a higher amount of tax is deducted by the employer.

Filing returns

The actual situation is such that the individual has actually made the necessary investments or taken the required action for the purpose of claiming the deduction but this is not showing the Form 16. As the time for filing of the tax return approaches the question in the minds of the investor is whether they will be able to claim the benefit at this point of time. If there is no other taxable income on which the tax is not outstanding then there would be a refund that could arise but in many other cases where there is some additional income then the tax already paid would go on to reduce the final amount that has to be paid.

Actual process

The good news is that the individual is able to claim the benefits of investments under Section 80C for specified investments upto Rs 1 lakh if they have actually done so but it is not showing in their Form 16. At the same time similar benefits like the premium paid on medical insurance or investments made in infrastructure bonds for the last year might also not have been considered but this is not a cause for worry. At the time of filing of the income tax return the individual would be able to ensure that they are claiming the same figure while the details are being filled in the tax return.

One of the results of such an action will be that the figures as shown by the Form 16 and the actual details filed at the time of preparing the returns will not match on several fronts. This will happen as the deductions will lower the amount of the taxable income and consequently the amount of the tax to be paid which will be different from what the existing Form 16 is actually showing. This is important but if the actual details have been completed then entering the right figures in the return columns in the tax return will ensure that the individual is able to claim the benefits that are due to them. Even if there is house rent allowance that has not been allowed earlier then this can be claimed at the time of filing of the returns and this will turn out to be an effort for the individual to get the available benefits.

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