Save Tax and Get Tax refund: The last date to file income tax returns (ITRs) for FY 2022-23 (AY 2023-24) is July 31, 2023. This due date is applicable for individuals whose accounts are not required to be audited under the Income-Tax Act, 1961. As per the Revenue Secretary Sanjay Malhotra, the government is not looking at a deadline extension for ITR filing. Everyone must file their ITR on or before July 31 to avoid late fees of up to Rs 5,000.
It is possible that you failed to inform your employer of certain expenses and tax saving investments. For instance, an investment in the Public Provident Fund (PPF) or in ELSS mutual fund schemes. Some people would not have submitted all the required documents to the employer to claim house rent allowance (HRA) despite living in a rented accommodation in FY 2022-23 (April 1, 2022, to March 31, 2023) and being eligible to claim tax exemption on HRA.
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Such misses usually occur if the investments are done towards the end of the year or if the rent payment receipts are not received on time. In such cases, the employer would deduct higher tax from your salary because documents supporting your claims are missing.
If a salaried individual chooses to follow the new tax regime for the financial year in question, they would not be eligible for most deductions. But if the individual goes for the old tax regime, then they have to submit proofs for eligible investments and expenses to ensure the employer cuts lower tax deducted at source (TDS) on salary.
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Here is how you can still save tax while filing ITR even if all the documents were not submitted to the employer.
Section 80C: Some of the common investments eligible for deductions under this section are contributions to Employees’ Provident Fund, PPF and ELSS mutual fund schemes, and premium paid for life insurance companies.
Apart from investments, certain expenses are also eligible for deduction under Section 80C through which a person can claim save tax. These include principal amount repaid on home loan and tuition fees paid for children’s education. The maximum deduction that can be claimed under Section 80C is Rs 1.5 lakh in a financial year.
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For effective calculation of deductions, look closely at all the eligible investments and expenses under section 80C.
HRA tax exemption: If you have lived in a rented flat in FY 2022-23 and received HRA from your employer, you are entitled to claim HRA tax exemption. Even if you have missed submitting the rent agreement or rent receipts to your employer, also one can claim HRA tax exemption while filing the ITR. However, you will be required to manually calculate the amount of HRA tax exemption you can claim. Read More at : HRA Exemption: A guide to claim full HRA exemption while filing ITR in India
NPS investment: Investments in the National Pension System (NPS) are eligible for deduction under three sections of the Income Tax Act. The first option is to claim deduction under Section 80CCD(1). This section comes under the ambit of Section 80C. In a financial year, an individual can claim a maximum deduction of Rs 1.5 lakh under both Section 80C and 80CCD (1) combined.
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In addition to that, an additional deduction of Rs 50,000 is available – beyond the claim under Section 80C to save tax. If your employer has contributed to your NPS account, you can claim deduction under Section 80CCD(2).
If investments were made in FY 2022-23, then you must check under which section the deduction can be claimed to lower the gross total income and thereby income tax liability.
Section 80D: Individuals who have paid premium for health insurance policy are eligible to claim a deduction of up to Rs 25,000 under Section 80D. Similarly, if the health insurance premium is paid for senior citizen parents, a deduction of up to Rs 50,000 can be claimed. Even if you have not submitted the insurance premium receipts to your employer, you can claim these deductions while filing the ITR.
It is possible that your senior citizen parents are not covered under any health insurance policy, and you have spent money on medical bills. In such a case, the individual is eligible to claim deduction for these medical bills.
Preventive health check-ups taken during the year are also eligible for deduction up to Rs 5,000 under Section 80D.
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Section 80TTA/80TTB: Interest earned from savings account is eligible for deduction under Section 80TTA of the Income Tax Act. However, the maximum deduction that can be claimed is Rs 10,000 in a financial year to save tax.
A senior citizen cannot claim deduction under Section 80TTA. They can claim a deduction under Section 80TTB for interest earned from various deposits such as savings accounts, fixed deposits and post office deposits. A maximum deduction of Rs 50,000 can be claimed under this section.
Read Also: Bank FD vs Senior Citizen Savings Scheme (SCSS): Interest rate, tenure, tax benefits
Standard deduction from salary: This deduction of Rs 50,000 is automatically taken into account by an employer provided you have opted for the old tax regime for TDS on salary for FY 2022-23. Your employer will not take this deduction into account if you have opted for the new tax regime. If you opt for the old tax regime while filing the ITR, you can claim this deduction.
LTA tax exemption: If you are eligible for leave travel allowance (LTA) tax exemption, you must submit the travel bills to your employer to claim the exemption. If you missed submitting these bills, chartered accountants say it is not clear whether you can claim this tax exemption while filing the ITR. So if you are filing for LTA tax exemption while filing the ITR, be prepared to answer the income tax department’s queries or a rejection of this claim.
Read Also: ITR Filing: How to report Capital Gain loss in Income Tax
What if you have not done Section 80C investments?
It is likely that you have missed making the eligible investments and expenses under the various sections, or the investment is less than the limit. In such a case, it is important to compare the income tax liability in the old and new income tax regimes.
Income tax law allows a salaried individual to opt for any income tax regime irrespective of what was communicated to the employer for TDS calculation on salary, which usually happens at the start of the financial year. So if you had opted for the old tax regime for the TDS calculation, you can change the preference to the new tax regime while filing the ITR, if it helps you save tax more.
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