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Will You Avoid Tax if You Can?

More than half taxpayers said that they would under-report their income, to save tax, in an online survey conducted by ET Wealth.

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Nearly 58% respondents of an online survey revealed that they would under-report their income to evade tax. This survey had over 953 respondents of all income levels and age groups. It was found out in the survey that about 82% tax payers have never given wrong information on their tax returns, knowingly, whereas, over 13.6% confirmed that they had done so once or twice. 4.4% taxpayers accepted that they had given incorrect information several times to invade their tax returns.

This survey demonstrated the fact that the honesty of Indian taxpayers is the result of the lack of opportunity instead of integrity. For salaried tax payers, the scope for evasion of tax is very less due to TDS. They may, however, under-report their income from other sources.

The most common fallacy is that of the taxpayer who has changed his job and got away with lower tax payment. Though he will get dual tax exemption and deduction from both the employers, it will be recovered, once he files his tax returns. Mr Vaibhav Sankla, Director, H&R Block said that if the tax liability is more than 10,000, after the due date, you will have to pay a penal interest of 1% per month of delay.

He further added that the employer deducts the tax based on the estimation of the annual income of the individual, who provides investment proofs and declaration. Therefore, the employee cannot blame the employer for non-deduction of due tax. It is the sole responsibility of the employee to check and verify the information reflected in Form 16.

Source: Times India