Savings Declaration vs Actual Savings

Dear Sir, I want to know the relationship between savings declaration (form) that we submit at the beginning of the FY and the actual savings that we do by the end of same FY. I'm a salaried professional and declared HRA and LTA in my savings declaration form but could not travel during this year, my accountant wants a proof for this anyway...what to do? Please answer both the aspects: a. If actual savings are less than declared. b. If actual savings are more than declared.

Thanks.

asked Feb 16 '12 at 11:50 by saifsd 1111


Investment declaration is taken in start of year so that employer has some idea of employee's year taxabliity and may deduct monthly TDS accordingly.

Near the end of financial year, employer need actual proofs for the tax saving so that pending taxes can be adjusted in remaining few months.

Ideally there should not be big difference between what is declared and the actual investments. But even if there is difference in these, employer would have to accept that.

As per IT rules, one should submit 30% of total taxes by 15th Sept, 60% by 15th Dec and all by 31st March. In case there is big difference between declaration and actual (declaration is more than actual), this will be disturbed and one may have to pay interest penalty for late deposit of taxes.

To avoid above issue some employer force employees to stick to the declared one.

If actual savings are more than declared, one may already have extra taxes deducted and deposited. So in this case there may be a refund required which can only be received after IT return filing.

answered Feb 16 '12 at 22:56 by pankaj 5.2k320

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Asked: Feb 16 '12 at 11:50

Seen: 1,686 times

Last updated: Feb 16 '12 at 22:56