Do we need to submit FORM-10E to AO for claiming relief under section 89 in case of arrears of salary??? If answer is "YES", when shall I submit that application to AO. I mean should i submit it during the year on estimated income for the whole year or after the completion of P.Y.
6 Replies
Kishor Bhat
(CA final CS executive (from Bangalore))
(1881 Points)
Replied 28 January 2014
1st ur current employer is making TDS. U can claim relief u/s 89 at the time of tax deduction. So submitt form 10E to the employer at the time of making TDS. Employer should consider those prescribed particulars then u get form 16 after effecting those arrears u/s 89.
Kishor Bhat
(CA final CS executive (from Bangalore))
(1881 Points)
Replied 28 January 2014
1st it is the duty of the employer to consider the details of form10E.
Kishor Bhat
(CA final CS executive (from Bangalore))
(1881 Points)
Replied 28 January 2014
if u failed to give to employer then ofcourse last remedy is submit to AO
KCJM and Associates
(Chartered Accountants Firm)
(864 Points)
Replied 28 January 2014
In order to claim relief u/s 89(1) of the Act, the person who is in receipt of arrears of salary or advance salary, such person has to apply in Form 10E to the person who is making such payment, who after verification of the same shall calculate the relief u/s 89 while determining the amount of TDS to be deducted u/s 192(1).
The assessee is not required to submit the said Form 10E to the Assessing Officer while claiming relief u/s 89 of the Act, but he is expected to maintain accurate particulars of information, for verification of the amount claimed as relief u/s 89.
By Siddharth Galaiya, Tax Solutions Specialist, KCJM
https://www.kcjm.in/
Rubul
(Student)
(151 Points)
Replied 29 January 2014
Thanks members. My understanding is also same but than bare Act of Income tax is telling a different story
"
1[Where an assessee is in receipt of a sum in the nature of salary, being paid in arrears or in advance or is in receipt, in any one financial year, of salary for more than twelve months or a payment which under the provisions of clause (3) of section 17 is a profit in lieu of salary, or is in receipt of a sum in the nature of family pension as defined in the Explanation to clause (iia) of section 57, being paid in arrears, due to which his total income is assessed at a rate higher than that at which it would otherwise have been assessed, the Assessing Officer shall, on an application made to him in this behalf, grant such relief as may be prescribed.2]
3[Provided that no such relief shall be granted in respect of any amount received or receivable by an assessee on his voluntary retirement or termination of his service, in accordance with any scheme or schemes of voluntary retirement or in the case of a public sector company referred to in sub-clause (i) of clause (10C) of section 10, a scheme of voluntary separation, if an exemption in respect of any amount received or receivable on such voluntary retirement or termination of his service or voluntary separation has been claimed by the assessee under clause (10C) of section 10 in respect of such, or any other, assessment year.]
___________________
1. Substituted by the Finance Act, 2002, with retrospective effect from 1st April, 1996. Prior to substitution, section 89 stood as under :
89. Relief when salary, etc., is paid in arrears or in advance. (1) Where, by reason of any portion of an assessees salary being paid in arrears or in advance or by reason of his having received in any one financial year salary for more than twelve months or a payment which under the provisions of clause (3) of section 17 is a profit in lieu of salary, his income is assessed at a rate higher than that at which it would otherwise have been assessed, the Assessing Officer shall, on an application made to him in this behalf, grant such relief as may be prescribed. (2) Omitted by the Finance Act, 1988, with effect from 1st April, 1989.
2. See Rule 21A. For analysis, see Mashbras Income-tax Rules.
3. Inserted by the Finance (No. 2) Act, 2009, with effect from 1st April, 2010."
Anyways please clarify me one more thing, the employer of the assessee refused to take effect of sec 89 in Form-16 (as he is not aware of sec-89 and also not in a mood to learn it) and asked the assessee to take effect of this provison in ITR-1 and get relief through refund route. So my question is if we take effect of sec 89 directly in ITR and also submit a copy of Form-10E to employer, will it be consider as compliance of sec 89???
Ankur Jain
(Student Others)
(132 Points)
Replied 10 June 2016
I have doubt, regarding section 89 ,Arrears claim tax relief:
My brother is in bank and he has received 92679 amount as part of arrear in FY 2015-16 but it was pending for last 2 year that means FY2013-14 and FY 2014-15.
1. Do i need to equally divide the arrear for each year .equally divide for last 2 year and current year ?
2. after dividing the arrears how would i calculate the tax ,Should i consider the exemptions of previous years like section 80C while calculating tax for last 2 year (with or without arrears as per the instructions ) ?
3. if i am eligble to avail the tax in section 89 then where i need to fill the same inn ITR-1. However i know that i need to fill form 10-E
4. I can see that we can fill the form 10-E online should i need to submit phyical copy also ?
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