By Abhishek Soni
If you work for a company, your Accounts team expects you to declare your tentative investments at the beginning of the year, present the complete list of tax-related investments, and submit all proofs of that Financial Year.
However, you may have missed out on submitting them. For example, your bank might have sent your home loan certificate late, or you might have missed the deadline for submitting documents due to some personal reasons.
Whatever may be the reason, it’s dreadful to know that you may have to pay higher taxes. Hop onto the next section to know how you can avoid paying higher taxes this tax season.
Review Your Tax Situation
As with most life situations, the first and most difficult step is admitting that the problem exists. So, take some time out of your hectic schedule to analyse your tax situation. To start with, check your income and tax liability for the year. If you have no tax liability, you should not be concerned about higher taxes. Just file your income tax return and you are sorted. However, if there is a tax liability, you may have to analyse it deeply. There are certain tax-saving opportunities that you can still leverage.
Switching Between Two Tax Regimes
At the time of filing a return of income, one may switch to the old regime if they chose the new regime earlier and vice versa. The ITR Form asks for the individual’s choice and the tax is computed accordingly. The TDS in excess of the final tax liability (ascertained after taking into account the allowable deductions/ exemptions), may thus be claimed as a refund by opting for the old regime in the ITR.
Check Existing Exemptions and Investments for Availing Tax Deductions
Tax planning does not necessarily include buying new assets, especially when the year has been so financially difficult for all of us. In all likelihood, you might have invested in some of the regular payments that qualify for a tax deduction. Some examples are:
- Children’s tuition fees
- Life & Medical Insurance premiums
- Your share of PF contribution to your employer’s PF fund
- Loan EMI payments
If you have been unable to fill your cup with investments, these expenses will come to your aid. However, you can only claim these deductions if you have made those investments after the last date given by the employer for proof submission but before 31st March of the financial year.
Note: Make it a point to maintain authentic proofs of such investments in hand in case the IT department requests them in future.
Explore More Avenues
If you reside in a rented home and have paid rent payments, you can claim a deduction for House Rent Allowance when you file your tax return. All you need are your rent receipts and your landlord’s PAN (where rent payments are more than Rs 1,00,000 per annum).
(The author is the founder of Tax2win, an online tax filing platform. Views expressed above are those of the author and not necessarily of financialexpress.com. Please file your ITR before the due date)