Personal Finance & Money Asked on August 23, 2021
I’m working as a software engineer in an IT company.
I’m filing ITR form-1 for FY 2019-20.
My company had deducted and submitted TDS of around Rs 7000 on 6/01/2020 to IT department.
Initially, while filing the ITR, my tax payable was coming as Rs 0.
After adding interest from saving account, my taxable salary became more than 5 lakh.
Now, it’s showing tax payable according to the slab(Rs 12500 + 20% of amount above 5 lakh).
This is fine.
However, it’s also adding a total of around Rs 4000 interest against below sections:
As per my understanding, salaried professionals shouldn’t be considered for advance tax.
Is my understanding correct?
If yes, then why the section 234 interest amount is added?
If no, then what is the process and how could I have avoided it? We get our form 16 from company sometime in July then how can we calculate and submit advance tax on time?
Any responses are appreciated!
Thanks
Rahul
As per my understanding, salaried professionals shouldn't be considered for advance tax. Is my understanding correct?
No, advance tax is applicable for all. Taxes should be paid as per the schedule, 15% by 15th June, 45% by 15 Sept, 75% by 15th Dec, 100% by 15 Mar.
For salaried class, the TDS takes care of it.
During filing of returns, if your self assessment taxes are more than 10% of total taxes, interest of 1% is charged for the delay on the delta amount that is due. 1% penalty is for payment after March.
If no, then what is the process and how could I have avoided it?
You can check what the interest on savings accounts will be and pay taxes in Advance.
The amount Rs 4000 in interest and penalty looks large. You have TDS of Rs 7000 and total taxes of Rs 13,000. Difference of Rs 6000, 1% is Rs 60; depending on TDS, the payable due from September, so 660. Plus one percent penalty for April Sept, another 660
Answered by Dheer on August 23, 2021
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