I had invested ₹20000 in long run infrastructure bonds within the 12 months 2011 for 10 years beneath cumulative possibility. The bonds matured in December 2021. I’ve obtained ₹44624 after deduction of TDS of ₹2736. An quantity of ₹27360 is proven in my AIS as revenue from different sources. I’ve been displaying the curiosity accrued on these bonds yearly in my ITR for previous 10 years as curiosity revenue. Since it’s reflecting in my AIS and 26 AS now this 12 months am I required to indicate the lump sum quantity as revenue once more this 12 months and pay tax on it? Is there any means that I wouldn’t have to pay the double tax as I’ve already paid tax on accrued curiosity over previous 10 years? How to mirror similar whereas submitting my ITR.
Under the tax legal guidelines sure revenue grow to be taxable on receipt foundation and sure different revenue grow to be taxable on accrual foundation. There are sure incomes which grow to be taxable on earlier of accrual or receipt like wage the place wage obtained upfront in addition to wage accrued although not obtained turns into taxable. In respect of capital positive factors, the capital positive factors grow to be taxable as soon as a switch takes place regardless of precise receipt of consideration.
In respect of sure revenue that are taxable beneath the pinnacle “Profits and positive factors of enterprise or Profession” and “Income from other. Sources” the taxpayer is given an possibility to supply for tax his revenue both on the premise of accrual or on receipt foundation as per the accounting methodology persistently adopted. Since the curiosity revenue is usually taxable beneath the pinnacle “Income from different sources” the identical will be provided for tax both on accrual or on receipt foundation. As you could have already provided the curiosity on these bonds on accrual foundation, the identical can’t once more be taxed on receipt foundation.
As far as disclosure in kind No. 26AS and AIS is anxious, you needn’t fear. While submitting the ITR please declare the total TDS as is proven within the kind no. 26AS/AIS however present solely the revenue for the 12 months. As the revenue being proven in your ITR will probably be decrease than the one proven in 26AS/AIS there’s a likelihood that you could be get a discover from the revenue tax division however you may clarify the actual fact of the differential curiosity already having been provided for tax in earlier 12 months. This would kind out the matter for you.
Balwant Jain is a tax and funding skilled and will be reached on [email protected] and @jainbalwant on Twitter.
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