Losses and other incomes that can be disclosed to employer for TDS

As per section 192 of income tax act, an employee may furnish particulars of other incomes to employer that he has incurred during the financial year. While disclosing, employee can also disclose income tax that has already been deducted from such other incomes.

After employee’s declaration, employer will consider other incomes and Tax deducted at source from it while calculating TDS on salary. The net TDS after such inclusion may go up or comes down based on the disclosure.

However, it is not mandatory for the employee to disclose such income to the employer.

You can consider these incomes in addition to salary while deriving your tax liability at the year end.

If any extra tax need to be paid, then that can be paid before the due date of IT return filing or else it has to be paid along with interest as applicable to you.

For example, if you have bank interest of Rs. 50,000 on which TDS of Rs. 5000 has been deducted by the bank, then both the amount can be disclosed to the employer.

While calculating Tax Deducted at Source on salary, your employer will consider both the figures and balance TDS if any will be deducted from your salary.

You have option of not disclosing such income and TDS to your employer. In this case you need to consider the interest of Rs. 50,000 and TDS of Rs.5,000 while filling your tax return at the year end. After considering such income and Tax Deducted at Source, if anything required to be paid then that has to be paid before the due date of income tax filling.

You need not provide any document while disclosing other incomes and TDS deducted out of it. You just need to provide the figures and the source of income to your employer.

Similarly losses can also be disclosed to your employer and that can be considered while calculating TDS on salary. But income tax act does not allow all losses for the purpose of TDS on salary.

As per section 192 of income tax act, only loss from house property is allowed to set off against salary. No other losses are allowed to be disclosed to employer for calculating TDS on salary.

However one can calculate and consider such other losses while calculating tax at the year end. Based on this if any refunds are to be claimed then such refund can be obtained from IT department.

Following incomes can be disclosed to employer;

1. Interest from saving account – interest more than Rs. 10, 000 should be declared as income. Otherwise total interest amount can be disclosed and under section 80TTA Rs. 10, 000 can be claimed as tax deduction.
2. Interest earned from fixed deposits
3. Interest from recurring deposit
4. Cash gift
5. Capital gain
6. Income or loss from house property