How not to become a tax offender
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There is a 98 per cent chance that you are a tax offender; particularly so if you are salaried. But I will come back to that in a moment. Consider these fancy words; compliance, diligence, TAT, efficiency, service quality, six sigma etc. Of course you know that these words emerge from the corporate culture that you are a part of. These words have a lot of meaning in our everyday job. You expect the whole world to comply in every possible manner but in matters of finance specifically, you consider yourself excluded. How is that? There are ample examples and we shall focus on tax for the moment.
The tax filing date has just passed by us (luckily though it has got extended to August 31) and you did not even give a second thought to your non-compliance of not filing tax returns or not filing in time. You think and believe that since you are employed your employer has paid the tax on your behalf and for you there is nothing to worry.
The former is true while with the latter you are grossly mistaken. Not filing or not filing on time is a compliance issue per se but let us focus on three popular types of tax evasion that most salaried persons often do.
The bank interest and form as26
9 out of 10 salaried persons in India have a fixed deposit and a sizeable amount of money in the savings account. This money earns interest and if you earn a lot of interest in a financial year, the bank/ financial institution will also deduct tax at source before paying such interest to you.
This part payment of tax is clearly visible on your AS26 form maintained by the tax authorities. Hence, when you file your return, conveniently ignoring the income you have earned on bank deposits and saving accounts, you are effectively paying lesser tax and thus evading tax. Matters are worse if bank has already deducted tax and this is visible on AS26.