• Money refunded from employer Rs. 7.5 lakhs

I’m pilot by profession. When I got employed by an airline in 2011, I had to pay the airline Rs. 7.5 lakhs as my training cost which was refundable after 6 years. Since I did not have that kind of money at the time, I had to borrow it from my cousin and directly made payment to the company from his account via Demand draft. I refunded the said amount to my cousin over time. Last year in May 2017, my company refunded the said amount of Rs. 7.5 lakhs via cheque to my account. My question is; Is this amount taxable now ? Do I need to mention it during filing my returns and what are the consequences if I dont show it during filing. Can I justify it when I get notice from the tax department in future? I have all the proof of the transactions and also my contract letter with the company where it mentions the refundable training costs. 
Regards
Asked 3 months ago in Income Tax from Mumbai, Maharashtra
Hi,

No, This money in not taxable. You don't need to show it in your ITR.

Maintain all the proofs. It will help you in case you receive inquiry from tax department. Just check that this money of 7.5 lacs is not mentioned in your form16 as well.
Abhishek Dugar
CA, Mumbai
3469 Answers
156 Consultations

5.0 on 5.0

Dear Sir,

No need to mention amount of Rs.7.50 lacs received from the employer as it is a refund of security deposit with the employer. It is not an income. Ensure no interest was paid to you on this amount by the employer. Also check your Form 16 of F.Y. 2017-18 for such amount.

Maintain all records for future purpose.

Thanks
Vivek Kumar Arora
CA, Delhi
1422 Answers
31 Consultations

5.0 on 5.0

Hi

Such payment is not taxable under the Income tax act. This is merely a reimbursement. 

Nothing needs to be mentioned in ITR.

Yes, it is easiy justifiable. Also, there are rare chances of scrutiny.
Lakshita Bhandari
CA, Mumbai
2021 Answers
63 Consultations

5.0 on 5.0

Hi,

This amount is not taxable and you need not disclose this in your ITR. However keep all the proofs with you in case any query comes from the deparrment.

Regards,
Nikhil
Nikhil Khanna
CA, Mumbai
1203 Answers
11 Consultations

5.0 on 5.0

Hi Sir,

Hope you are doing well !

1.This amount is not taxable.

2.You don't need to mention this amount in your return.

3. First, there is very low chance of getting income tax notice for this. If you get any notice in future, it will be easily justified

4.Just keep all your documents.

Thanks & Regards,
Payal Chhajed
Payal Chhajed
CA, Mumbai
735 Answers
2 Consultations

4.8 on 5.0

Hi

This is pure financial transaction and not in the nature of income hence you are not required to show in your iTR.
Please keep all the documents with you for future references/income tax notice.

You should not worry, there will not be any tax liability.
Varun Chawla
CA, Ghaziabad
72 Answers

5.0 on 5.0

The amount of refund is not taxable as it is not your income. It is only a refund of an expense which you incurred in 2011. Nothing to worry and just make sure you have the evidence from the company regarding the receipt and also that this amount is nowhere reflected in your Form 16 as part of the salary, just to avoid unnecessary hassle.
Amit Kumar Narula
CA, Bangalore
59 Answers

5.0 on 5.0

No .refunded amount is not your income so not taxable.
No need to show this figure in ITR.
Yes when you have all the documents ,it can be justified easily.
Swati Agrawal
CA, Indore
619 Answers
1 Consultation

5.0 on 5.0

You may keep on records documents evidencing that your cousin has financed the said deposit. The receipt of such deposit from your company is similar to a rent deposit which we receive back when we vacate a rented flat. Accordingly, you may claim such receipt as deposit refund and not a taxable income. However, in case your employer had provided any interest on such deposit, then such interest shall be taxable in India.
Sanket Suresh Shah
CA, Mumbai
29 Answers

5.0 on 5.0

Ask a Chartered Accountant

Get tax answers from top-rated CAs in 1 hour. It's quick, easy, and anonymous!
  Ask a CA