Your take-home pay to go down if you fail to furnish PAN details to employer

Your take-home pay to go down if you fail to furnish PAN details to employer

New Delhi: Under the Income Tax Act, it is mandatory for all employees to submit their PAN (Permanent Account Number) details to their office’s HR or accounts departments since the onus on the office to make TDS (tax deduction at source) if your income is above the taxable limit.

While deducting tax at source, your employer is required to quote your PAN or Aadhaar number. You can check the status of TDS through the income tax department’s TRACES portal. If your income is below the taxable limit (Below Rs 2.5 lakh), it is not required for you to submit either PAN or Aadhaar card since TDS is meant to be deducted by your employer under Section 206AA of the Income Tax Act.

Note that for the financial year 2019-20, income up to Rs 2.5 lakh is tax-exempt. However, if your income falls within the taxable bracket and you fail to provide your PAN card details to your employer, the employer is liable to deduct TDS at the rate of 20% or even higher. For those employees whose income computed for TDS under Section 192 is below taxable limit, no tax will be deducted.

In case you failed to provide PAN to your employer who deducted a higher rate of tax from your salary, you can always claim a tax refund after filing of income tax returns (ITR).

It is worth mentioning that PAN and Aadhaar have been made interchangeable and you can now quote the 12-digit Aadhaar number in lieu of the 10-digit alphanumeric number PAN issued by the income tax department. However, know that in order to do so you need to ensure that the two identity documents are interlinked.

Also, while quoting your Aadhaar number in lieu of PAN, be very careful because giving an incorrect number will lead to a fine of Rs 10,000 under Section 272B of the Income Tax Act, 1961. If you have given the wrong number in multiple forms, you can end up paying even more.

 

Source:- timesnownews

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