Missing on any of these 8 tax tasks can be costly for you; Make sure to finish them by March 31
Completing tax saving stuff is not everyone’s cup of tea. At times, several taxpayers don’t even remember or know what they are required to do. However, there are some tasks which need to be finished by every taxpayer within their respective deadlines. That is because not finishing these tasks on time can prove costly for them.
March 31 this year is falling on a Sunday, while 30th of March will be the 4th Saturday of the month and a holiday for the banking industry. This means 29th March will be the last working day of this financial year unless the government issues directions to the banks.
If you are issuing cheques, making online payments through net banking, NEFT etc, ensure the funds get credited to your respective investments within this financial year. If payment goes through next year, the tax benefits may not be available for this year.
For a hassle-free financial year (FY), here are eight tax-related and other financial tasks you should complete before March 31st.
1. Late filers of ITR
The last date for filing an income tax return (ITR) for the financial year 2017-18 was August 31, 2018. However, if you had missed filing it, make sure to file it before March 31, 2019, even though you cannot escape the penalty under the newly introduced section 234F of the Income Tax Act. “If any individual taxpayer missed the due date of 31st August 2018 to file their return, they can still file it before 31st March 2019 by paying a fee of Rs 10,000. Note that late fee is restricted to Rs 1,000 for those with total income up to Rs 5 lakh,” informs Archit Gupta, Founder & CEO ClearTax.
2. Changed jobs? You need to file Form 12B
If you have changed jobs during the FY 2018-19, you should ensure that you have submitted Form 12B to your new employer. In the previous organisation, you might have submitted investment declaration for the purpose of tax saving, based on which the employer would have deducted the taxes accordingly. Form 12B is a statement wherein you will have to provide your new employer with the amount of income and taxes deducted by your previous employer.“Once the employee submits Form 12B with the required details, the new employer will furnish a Consolidated Form 16 at the end of the year based on the details provided by the new employee in Form 12B,” says Gupta. Not doing this will end up in paying taxes at the time of filing your ITR for the AY 2019-20.
3. Complete your tax savings
The maximum limit under section 80C stands at Rs 1.5 lakh and it includes investments into specific instruments such as PPF, NSC, ELSS etc. and also expenses such as tuition fees, home loan Principal payments amongst others. If you wish to reduce your tax liability, make sure, you have exhausted this limit before the FY ends. Simultaneously, you may consider tax saving under section 80 D on premium paid towards health insurance up to Rs 25,000 ( Rs 50,000 for senior citizen) for self and family.
The maximum that you can save under section 80C will be based on your tax slab.
4. Submit investment proofs to your employer
If you have already taken care of all tax savings, submit the documentary proofs to your employer. Most employers ask for such evidence in January or February and in case they are not accepting anymore, use them to claim a refund while filing ITR in the next FY.
5. Pay minimum amount to keep investments active
Certain investments such as PPF, NPS requires a minimum amount to be put into the account in each financial year in order to keep them active. Else, the account becomes inactive and one will have to regularise or unfreeze it before making fresh investments. The process of reactivating may be time-consuming and will also involve a penalty.
In order to avoid this, make sure you have invested the minimum amount before the financial year ends. The minimum investment in PPF is Rs 500 while that in NPS is Rs 1000. One should, however, make adequate investments in one’s investments so as to reap its benefits over the long term linked to one’s goal.
6. Link PAN with bank account
Although most of the bank accounts are already linked with respective PAN of the account holders, the income tax department had issued a statement that for refunds, linking of PAN with bank accounts must be ensured. “If you have refunds then link PAN with the bank account to get refunds into your bank accounts directly as the department will issue only E-Refunds from 1st March 2019.
7. Aadhaar PAN linking
Anyone holding PAN needs to ensure that it is linked to one’s Aadhaar number. In an advisory, CBDT had stated that “Constitutional validity of Aadhaar has been upheld by the Supreme Court of India in September 2018. Consequently, in terms of Section 139AA of Income Tax Act, 1961 and order dated June 30, 2018 of the Central Board of Direct Taxes, Aadhaar PAN linking is mandatory now which has to be completed till March 31, 2019, by PAN holders requiring the filing of ITR.”
8. Submit Form 15G / Form 15H to tax deductors
In case you have bank fixed deposits, the income is subject to TDS if the interest earned is more than Rs 10,000 in a financial year. However, by submitting Form 15G / Form 15H to the banker, there will not be any such TDS deducted from the income. “These forms should be submitted before 31st March 2019 so that no TDS is deducted by the banks if the income is not taxable,” says Gupta. Form 15H is for individual who is of the age of sixty years or more while Form 15G is for all others for whom the total income will not exceed the maximum amount which is not chargeable to income-tax. If you had already submitted at the start of the FY, be ready to repeat the exercise in the first month of next FY as well.