Why i am paying extra after company switch?

Hi Pankaj,

I was working i company A and switched to another company B. In company A my package was 4.7LPA , in company it is 8.25LPA. I switched to other company on SEP-13-2013.

And now i trying file my it-returns but it i have to pay extra 14K . Can you tell, what can be the reason for this .

asked Jul 18 '14 at 12:40 by Jags 63

You may have not declared your earlier employer income details with current one. If it is not the case, they may not have computed total taxes correctly.

What happened here is, first company paid you X amount in FY 13-14 and deducted tax on it, considering your whole year income would only be X as they don't know anything about remaining financial year. In computing tax on this X amount, they would given you upto Rs 2 lakh tax free as per standard tax slabs.

Now if you have not declared X amount to second employer, or they have not used it in computation, and they paid you Y amount in FY 13-14, they also considered your total year income as Y. Again in computing tax on this Y amount, they would given you upto Rs 2 lakh tax free as per standard tax slabs.

So once you add X+Y as total year income while filing income tax return, it would show extra tax that's needed to be paid, as 2 lakh tax exemption would be provided only once.

I hope, I am able to explain the case!

answered Jul 18 '14 at 12:53 by Pankaj Batra 5.2k320

Thanks for the clarification .
(Jul 18 '14 at 15:51) Jags

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Asked: Jul 18 '14 at 12:40

Seen: 1,233 times

Last updated: Jul 18 '14 at 15:51