Was ₹15,000 of hidden tax deducted from your pocket? This math between Form 26AS and ITR could save vehicle owners thousands of rupees Was 1% TCS deducted while buying a car? Don’t consider this as ‘lost money’, get your full refund by filing ITR

Whenever someone goes to a showroom to buy a new car, his entire focus is on the look of the car, ex-showroom price, insurance, RTO charges and accessories. While taking delivery of the car, a lengthy invoice is handed over, which most people pay without fully understanding it. But do you know that if the price of your car is more than Rs 10 lakh, then there is a small tax added to the same invoice which you can later ask for back from the government!

The name of this tax is TCS means Tax Collected at Source. The most interesting thing is that many car buyers are not even aware that this money can be got back in the form of refund. Due to lack of information, every year thousands and lakhs of rupees of people remain lying with the government. Let us understand in very simple words what this whole game is and how you can get your money back.

After all, why is TCS deducted on buying a car?

According to Income Tax rules, whenever a person buys a car worth more than Rs 10 lakh, it is the responsibility of the car dealer to refund the amount to the customer. 1 percent (1%) TCS will be collected at the rate of Rs.

To put it in simple language:

• the car is yours

• the money is gone from your pocket

• PAN card is also yours

But the dealer already deposits this 1% advance tax in the government account in the name of your PAN number. This is not an extra hidden charge or showroom fee, but an advance tax payment registered in your name, which remains safe in your tax records.

Understand the whole mathematics with a small example

Suppose you have chosen a luxurious car worth Rs 15 lakh for your family.

• Car Price: ₹15,00000

• TCS at the rate of 1%: ₹15,000

This means that the car dealer will charge you an extra ₹15,000 in the invoice and deposit it with the government. Now this ₹ 15,000 has been linked to your PAN card. When you file your Income Tax Return (ITR) at the end of the year, if your total tax liability is less than this amount, the entire amount will be refunded to your bank account along with interest.

Why do people forget to take refund of their own money?

It is a big question that when money is theirs, why do people give it up? Some of the main reasons behind this are:

• Most buyers are not aware that the TCS given on the car is refundable.

• Even the showroom sales executives do not disclose this tax openly in their hurry to sell the vehicle.

• People see the total amount of the invoice and make payment directly through check or loan and later on their tax portal. Form 26AS Forget to check.

• There are many people whose salary does not come under the tax net, hence they do not file ITR, due to which their money remains lying in the government account forever.

Why is Form 26AS the biggest proof?

If you have purchased an expensive car in the recent past, then you should immediately login to your income tax account. Form 26AS (Tax Credit Passbook) Should check. In this form you will clearly see that:

1. How much TCS has the car dealer deposited on your PAN.

2. On which date and through which dealer (TAN number) this money has been deposited.

This form itself is the biggest sure proof that your money is safe and has reached the government.

Step-by-step: How to get your TCS refund

This process is not very difficult, you just have to keep a few things in mind while filing ITR:

step 1: From the dealer at the time of or after purchasing the car Form 27D Must ask. This is the official certificate of TCS deposit.

Step 2: Go to your income tax e-filing portal and check Form 26AS and AIS (Annual Information Statement) to see whether your TCS amount is reflected there or not.

Step 3: When you file your Income Tax Return (ITR), there “Taxes Paid/TCS” Go to the section above and add this amount as a claim.

Step 4: After completion of ITR processing, if your total tax liability becomes less, the excess amount will be transferred directly to the bank account linked to your PAN.

Will the full amount be refunded or will it be adjusted in tax?

It completely depends on your annual income and tax liability.

• Situation A: If at the end of the year you do not owe any tax or very little tax is owed, you will get a refund of the entire TCS amount.

• Situation B: If your tax is higher as per your income, then this ₹15,000 (or whatever your TCS is) will be deducted from your tax payable, meaning you will have to pay less tax. In both cases the benefit is yours.

Important points for car buyers (Quick Summary)

Useful thing: Even a small mistake made due to lack of information can prove costly. If you are a salaried employee or a first-time car buyer, check your invoice again. This TCS is not your lost money, but your hard-earned money which you can get back by following the right procedure.