Income tax return You invested in fixed deposits or NSCs to save tax or received dividend from your ELSS fund during the year, you don’t make the cut for the exemption. Have you given your house on rent for even one month? Sorry, you will have to file returns. Anybody who bought infrastructure bonds to claim deduction under Sec 80CCF is also not eligible. Only a person who has no tax-saving investments and lets all his money idle in a bank will be eligible. Let us assume that there is indeed somebody who has no such investments and, therefore, no income other than from his salary and the interest on the bank account. Even then, he may not be able to fulfil the conditions for exemption.
The notification says that the tax due on the interest income should have been paid and the income and the tax should be mentioned in Form 16 from the employer. The interest on bank account is credited on a half-yearly basis. The interest from October to March gets credited after March 31. You need to be a financial expert to correctly estimate the tax due on this income and pay the right amount. That’s not all. You also need to provide these details to your employer in time for the accounts division to mention them in your Form 16.
A taxpayer’s quest for filing nirvana doesn’t end here. If he has changed jobs during the year, a taxpayer won’t be exempt from filing his tax returns. Given the high employee turnover rate in certain industries, such as software and IT-enabled services, very few people in these sectors will be able to claim exemption. Even if the employer agrees to include these details in the Form 16, there will be other deductions that won’t be mentioned in Form 16. For instance, any donation to charitable organisations is not mentioned in Form 16. It is up to the taxpayer to claim deduction for the donation and this can only be done by filing the return. Similarly, if you have carried forward losses or have a refund, you won’t be able to do so if you don’t file.
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