Guide to Submitting Tax Investment Proofs to Your Employer

I hate it! This is probably your reaction when it comes to gathering and filing proofs for your investments, medical expenses, rent receipts, donation receipts etc. for this financial year. Yes, it’s that time of the year again. Don’t despair. Here are some useful pointers for you:

More Proactive and Less Reactive

There is no use in being lazy now and run around for refund collections later from the tax department. It is important to make your tax-saving investments if you haven’t done so till now. It is better to furnish as much and as correctly as possible now, to have an easier time after March. It is true that you can completely not submit anything now and later claim a refund for the extra tax you may end up paying. But, you will have to wait till December for the refund. Your company asks for evidence as they are third parties when they deduct tax at source, often referred as TDS. They are obliged to furnish evidence if the tax department asks them later. So be proactive and submit all the evidence now to have a relaxed 2016.

Evidence/Proofs

Typically you would need the following:

• Investment receipts for 80C related investments which cover premiums paid towards life insurance, annuity received through deferred annuity plans , contributions made to provident fund schemes , investments in certain equity stocks /debentures etc.
• Rent receipts for HRA entitlement. Some organisations accept registration document in place of receipts.
• Home loan interest certificate if you would want to claim deductions under home loan principal and interest payments
• Medical bills and pharmacy bills for claiming 15000/-
• Boarding Passes/Railway Tickets for LTA claim
• Any donation related expenses for which you need receipts. It needs to be a tax free donation though.

Other Income

If you have other income along with your regular job, you can reduce your work towards the end of the financial year, by including this in your income tax calculations. Typically other income can come from:

• Fixed Deposit interests
• Selling of shares/equities
• Parallel income/Freelance income
• Premature withdrawal of a tax saving investment

Ask your payroll department on how to do this straightaway.

Not Claiming Now?

If you don’t claim now for any reason beyond your control, don’t worry. You can claim when you file your tax returns for the year. Albeit there will be some delay, the refund will come for sure. I can vouch for it as yours truly has claimed a refund in the past. In fact the government does not need your evidence when you do so. Only when they suspect something, do they call for evidence.

Don’t Forget

We still have 2.5 months left in the financial year for which we would be required to submit our evidence again in March. So don’t forget about the next 2 months to continue gathering as much evidence as possible. You will give these prospective investments/donations now, which your employer will use for computing tax. This has to be proven later in March.

Final Word

We all live in a society that we need to look out for. One way we do this is by paying our taxes. So let’s be extremely honest while claiming deductions that we are rightfully entitled to. Before we point fingers at dishonest politicians, we need to be in the right.

Arjun Balakrishnan is an investment fanatic who loves writing about investment topics. He regularly writes at Investment Gyaan.