Anybody who’s changed jobs during the year will tell you what a tangled mess it is to file an income tax return for that year. We’ll discuss three common problems salaried individuals who’ve changed jobs encounter.
First, I forgot to get my Form 16 from my previous employer.
Good news, income tax returns can be prepared without a Form 16 and with just only payslips. Add up all the salary credited and tax deducted from the payslips.
You can also find tax credit information on your Form 26AS. Learn how to access your Form 26AS here.
Have two Form-16s? Did you know that ClearTax supports multiple Form-16 uploads? Read our guide to e-filing with two Form-16s.
Second, I have a huge tax due to pay off.
Your first employer calculates your salary and TDS, based on the deductions you had declared at the beginning of the year. If you didn’t disclose your salary from the first employer to the current, your current employer only calculates taxes for the remainder of the tax and deducts TDS accordingly.
There’s also a chance that you could have invested more under Section 80C during the year than you originally declared to your previous employer.
So, to avoid discovering a huge tax bill closer to the submission deadline, calculate all the numbers again and pay tax dues, if any.
- Start with salary for Co. 1 for X months + salary for Co. 2 for Y months
- Total deduction made between April 2014 – March 2015
- TDS deducted from both Co. 1 + Co. 2
Now use the income tax calculator to find out if there are any pending taxes this year. Pay the due and file your income tax return.
Third, I don’t know what to do with my PF balance.
Fill up the Form 10C and Form 19 and transfer your PF money to the current employer if your current employer offers EPF benefit.
In case you choose to withdraw your EPF balance before completion of 5 years of service, then withdrawals will be fully taxable. They are tax-free after 5 years.
Tax rules on EPF withdrawals are changing starting 1st of June. Read more about tax on EPF withdrawals here.
Stuck with one of these issues and need a tax expert’s help? Write to us at firstname.lastname@example.org. We’re here to help 🙂