For many working professionals in the nation, investment is progressively becoming a lucrative option. Investment numbers are flying into the ceiling at the present, with many private financial lenders offering higher inflation. Having securities under your name makes them liable to tax, making it necessary for you to report to your employer all your investments. You are required to request a statement of your intended investments before being employed by an employer. As long as you are serving, this phase is renewed at the beginning of the following fiscal year. Your employer will subtract higher TDS from your salary if you don’t submit proof of investment at the right time. Consequently, if you do not find the likelihood of foregoing any cash especially inviting, you should be careful and submit appropriate investment proof to your employer.
TDS
In India, any employer is allowed to subtract TDS from the compensation of their employees as per their specific pay scale. The employer will deduct Rs. 12,500 as TDS if an employee with a salary of 5 lakh per annum does not disclose her investment information. Declaring the specifics of your investment will minimize this TDS to Rs. 10,000 and enable you save money. For all salaried people, the Income Tax Department has made it very clear that their income tax returns should be accurate and issued to the employer in an acceptable and concise way. Therefore, it has been a stringent mandate, which now covers most businesses, that at the onset of each financial year their employees have income-related records. If your employer does not submit the investment statement, you will have to face the possibility of higher TDS losses. The reimbursement for any incorrect TDS cuts may be sought in the Income Tax Returns through a refund claim.
What your employer must do?
Employers should forward emails to employees to submit documents related to investment claims so that employees can potentially benefit from income tax benefits with the relevant, relevant financial records. For your side, by communicating with them and providing them the correct details of your investments, you can assist your employer so that you do not have to go through the trouble of reducing higher TDS cuts at a subsequent time.
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