How to File Taxes When Switching Jobs: Can I Combine Salaries from Two Companies?

Hi, I have worked in two companies in a year. For example: Company 1 - Apr 2014 to Jan 2015 Company 2 - Feb 2015 to Mar 2015

Company 1 did not deduct TDS. Company 2 said they can't include the previous company's salary for tax calculations.

Tax Filing Query

On my own - Can I combine and file my taxes for the income/salary received from these two companies?

If YES, 1. What proofs do I need to have? 2. How do I calculate and file my tax for FY 2014-2015?

If NO, 1. What do I have to do for filing?

Thanks for helping with this.

Regards, Krish

Form 16A is a TDS certificate showing how much TDS has been deducted and details of the deposit with the IT department. Your Fixed Deposit (FD) may have TDS deducted, and the bank will pay the IT department and reflect it in Form 16A.

Have you registered on the Income Tax site for online viewing of Form 26AS? Depending on your income from salary, interest on FD, and savings account, you can calculate your tax and make online payment of income tax. There are free tax filing sites that can assist you in filing your income tax returns electronically.

One such site is Cleartax.in.

Yes, I did register.

My previous FY 2013-2014 tax was deposited by company 1, and I am able to view form 26. Now, I have joined another company 2. Company 1 didn't provide form 16 for Apr 2014 to Jan 2015; they gave only payslips. Company 2 instructed me to do taxes by myself. Is it possible to file using payslips?

Hi Krish,

Your previous company will give you Form 16 at the end of April-May 2015. Please coordinate with the accounts/HR department of your previous company.

Your current company will also provide you with Form 16 at the end of April-May 2015. Ask your personal CA to consolidate both Form 16s to file your personal return for the financial year 2014-15.

Note: Always ask your employer to provide an Income certificate at the time of leaving the organization.

Regards,
Ashish

Yes, you can work out your total taxable income and pay by challan through your bank. All transactions can be done online.

If the company did not deduct any tax and issue Form 16, ignore it. File the taxable income of Company 2 only through online facilities.

Pon

The advice is incorrect. Company 1 had employed him for 10 months in the concerned F/Y, and income of this company alone may not be in the taxable limit. Company 2 has paid him for two months. Whether Company 1 gave form 16 or not, the person has received taxable income. Filing a return for just 2 months of income will easily leave a paper trail where the person could be asked whether he was unemployed or without income for 10 months. One should be careful in IT matters.

Dear Krish, I am here to help you. As per income tax law, Form 12B can be submitted to the new employer with the salary and deducted TDS details by the old employer. The new employer should consider the previous salary and TDS. In your case, it was not done. No issue. If the employer does not deduct tax (TDS), he is not liable to issue Form 16/16A. Instead, you may get a Salary Certificate on their letter pad. It will do. So you should get a Salary Certificate from your old employer. If your new employer has deducted tax (TDS), then you will get Form 16/16A in June 2015. If they have not deducted tax, then get a Salary Certificate from them too.

Filing Your IT Return

Now, when it comes to IT Return, the due date of return filing is 31st July, so don't worry. Calculate your total earnings, compute your tax, observe the TDS, pay the remaining tax online, and finally file your IT Return. I will be happy to help you in filing your return as I am also a Certified Tax Return Preparer (TRP). You can find my contact details on trpscheme.com using the 'Locate TRP' feature. Hope this answer will help you.

Regards

Income Tax Filing for Multiple Sources

Income from all sources needs to be clubbed while filing income tax returns, not just declared separately. If the total income, including all employments, interest, home rentals received, and any other income, exceeds the specified limit (i.e., Rs. 250,000 for an assessee less than 60 years of age), then the individual needs to submit an IT return and also pay the tax if any liability arises.

@Krish, all you need to do is gather exact income from all sources, i.e., from both employments, interests from banks, bonds, NSCs, or similar investments, and file your return accordingly. In case you need help in filing a return, I am also a tax practitioner; you may ping me personally.

Regards

Tax Filing Guidance for Multiple Employers

I am here to help you. As per income tax law, Form 12B can be submitted to the new employer with the salary and deducted TDS details by the old employer. The new employer should consider the previous salary and TDS.

In your case, it was not done. No issue. If the employer does not deduct tax (TDS), he is not liable to issue Form 16/16A. Instead, you may get a Salary Certificate on their letterhead. It will suffice. So you should get a Salary Certificate from your old employer. If your new employer has deducted tax (TDS), then you will get Form 16/16A in June 2015. If they too have not deducted tax, then get a Salary Certificate from them too.

Now, it comes to IT Return. The due date for return filing is 31st July, so don't worry. Calculate your total earnings, compute your tax, observe the TDS, pay the remaining tax online, and finally file your IT Return.

I will be happy to help you in filing your return as I am also a Certified Tax Return Preparer (TRP). You can find my contact details on trpscheme.com using the 'Locate TRP' feature.

Hope this answer will help you.

PFA Form 12B for your convenience. This is the right procedure as an employee has to do. But now 31st March has elapsed. If your Company 2 accepts Form 12B, it's fine; otherwise, it's your decision. So you have to work out your taxability by yourself by clubbing both Company 1 & 2 and remit the self-assessment tax using the relevant challan to avoid interest accrual. This will also help you to file your tax return before 31st July in due course.

Regards