Tax impact/refund/recovery
Recd Rs. 80000/- as a joining bonus from company with the signed agreement(in stamp paper) to refund full amt. if i leave before completion of two yrs from date of joining. company is already deducted tax on above amount. completed 14 month in this organization and decided to move on, but as signed agreement, company demanding the full amount refund. my question is what about the tax amount? i have already submitted the return to IT, is there any way to recover the tax amount? can company take legal action against me if i do not agree to pay back the amount which has been deducted as tax?
2 Answers from Attorneys
Re: Tax impact/refund/recovery
Company should not have deducted tax on this amount at the time of payment. it was contingent receipt that could be your income only after you became fully entitled to recive it as income after completing two years.
Having deducted tax, the Company ought to have issued a TDS certificate to you. If you have claimed benefit of that TDS amount in your return, then you've received benefit of that amount. In that case you should return entire 80,000.
If TDS certificate was not issued, or you have not claimed benefit of the TDS, then you should return only what you received in hand an ask the company to claim refund of the tax deposited as the payment will be reversed in their books.
Re: Tax impact/refund/recovery
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