Tax experts in India are recording a significant increase in the number of incorrectly filed returns by the taxpayers who have had more than one job on the payroll in the course of the current financial year 2024-25. As the job market in the post-pandemic world has become highly volatile, chartered accountants have noted that nearly 40 percent of their clients who have changed their jobs are committing serious errors in furnishing their income tax returns.
Job hopping has taken new dimensions and professionals are more willing to have good opportunities and remunerations. Nonetheless, with this career mobility there are emerging surprises when it comes to the ITR filing season. Different tax practitioners observe that in this one, most victims may not be aware of the particular requirements in the declaration of multiple sources of income in one and the same financial year.
Industry estimates show that more than 2.5 crore salaried people in India switched jobs or had worked on several jobs in the financial year 2024-25. This is an increment of 35 percent over the year before, which demonstrates how today employment environment is dynamic.
Common ITR Filing Mistakes by Multi-Employer Taxpayers
It has been noted by tax consultants that there are some mistakes that many people make on a common basis that may lead to attention by the income tax authority. The most common one is the issue of salaries earned by employees working under different employers presenting them as the same stream of income as opposed to reporting them differently as indicated in tax laws.
Most of the taxpayers are also not adding their total taxable income properly. On the case when an individual has worked in two firms in the same financial year, his/her joint income may be forcing him or her in a higher tax bracket and he/she has to pay more tax to the government than the one that was withheld.
There is also the second lethal mistake that is the mismanagement of standard deductions and exemptions. Tax experts stress that there are some deductions that are restricted yearly to the overall income of a taxpayer and not to each employer. An example of this would be the standard deduction of 50,000 that one can avail of once a year, irrespective of the number of employers that a person has worked with.
Form-16 Verification Becomes Crucial for Multiple Job ITR Filing
Form-16 documents importance on multi-employer taxpayers has deepened because of the need to review it strictly. Every employer gives a different Form-16 and it is up to the taxpayers to ensure that all the documents are accurate before rushing to file the tax returns.
Tax consultants suggest to prepare a detailed check-list comprising gross salary by each employer, house rent allowance availed, professional tax payable and provident fund contribution. This arrangement systems is used to avoid omissions which may attract tax notices or punishment.
Switching of jobs is also an important issue in calculations of the tax depending on the time switch would occur. The people who switch jobs in mid-year members soon have an incongruity in the computations of their taxes since their new employer does not receive full details with regards to their former income and deductions of taxes.
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Tax deducted at source reconciliation has however got complicated among people with more than a single job who have a need to file ITR. TDS is deductible by each employer depending on the wage that the employer gives and not with regard to other sources of income. This usually leads to either over abuse of tax payment or under payment of taxes.
In Schedule TDS of ITR forms, the taxpayers need to enter the TDS details given by each of the employers separately, along with the Tax Deduction Account Number issued to the employer. The accuracy of reporting this kind of information can expose one to delays in processing as well as more enquiries on tax authorities.
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