factoHR’s Solutions For IT Declaration Challenges To Enable Easy Returns

Cost to Company

Income Tax is a partial mandatory deduction imposed by the Government of India to foster the economic development and defense needs of the country. Why partial? Because not every salaried individual is mandated to pay tax and it simply depends on their received salary and the tax slabs created under the new and old regime. However, the government allows employees to file income tax returns to recover the amount. And the ones who do, know how complex the process is. So exactly what are the common challenges that every HR and employee face during the financial year-end, i.e., the month of March, and how factoHR takes the edge off it?

What Challenges Do Employees Face During The Income Tax Declaration Process?

It is the employees’ duty to file their own income tax returns, and this process includes various information to be submitted. As the truthfulness of the information is essential, employees face a lot of difficulties, as mentioned below.

Employee queries

As the financial year is about to end, employees are supposed to submit their return amount and attach proofs for the same. Looking at the number of categories/sections provided to the employees, which includes HRA, hostel going children, bank interest, fringe benefits, allowances, etc., employees may find it difficult to understand and ask HR to resolve the queries regarding their exempted sections and where to submit the proofs.

Attachment sharing

Employees may be asked to submit the proofs either in softcopy or hardcopy. This can be done through mails or physical forms. If the person is a new recruit, he may be aware of the process and may seek advice from HR.

Exemption limits

Not every employee has a similar salary structure, payment, and benefits. This implies that employees may have different exemption criteria. As a general human tendency, employees may forget or are completely unaware about exemption limits on their taxable income, for which they have to ask no-one but human resource only.

Calculation of taxable income

As mentioned earlier, under the final income head, there are various income types that may or may not be considered taxable, based on which employees can consider the amount for exemption. With many such different types of income, it is extremely challenging to compute the taxability of the employees.

Type of regime

After the updates in the TDS slabs, only a few follow the new regime, while others still use the old one, and there’s no wrong with it. If the employees do not know the regime their companies use, they might have difficulty filing IT returns.

What Challenges An HR Face During The Income Tax Declaration Process?

Human resource is undoubtedly an indispensable part of any business, and it plays a significant role in the payroll process and income tax computation. Specifically, in the month of March, there’s no room on HR’s plate. Because the financial year comes with lots of responsibilities, and the organizations that process the IT computation manually feel a lot of hurdles to overcome. Let’s see what those are.

Proof management

During the income tax return, employees are requested to submit proofs to their organization which is supposed to be stored for the next five years. For all the employees, it may be difficult for the personnel to keep the documents secure for such a long span of time. More to this, if the organization asks to submit physical copies, there would be a huge pile of papers to keep every year.

Verification and deduction

After the submission of documents, it is required to verify and deduct the actual amount as mentioned in the declaration. For a considerable count of employees, it is a time-consuming and challenging task to verify all the details and perform the process accurately.

Form 16 and 24Q generation

As a sign of proof of deduction, employers are required to offer each employee a form that states the deduction amount as per the rules. These are form 16 and 24Q. Again providing these forms physically would be erroneous and laborious.

Calculation for different regimes

It is employees’ choice whether to consider the old or the new regime. It is then essential and hard to consider different regimes for different employees while income tax calculation.

Company liabilities

After the process of declaration, verification, deduction, and proof generation, companies should ensure their employees that all the tasks accomplished under the income tax computation are error-free and compliant. As for the consequences of non-compliance, they may be required to pay a huge amount of penalty.

How factoHR’s Solution Knocks Down The Income Tax Declaration Challenges?

The IT declaration feature in factoHR’s web solution and mobile application includes every aspect that could help employees and HR through the process of income tax computation. Here are the solutions offered for the challenges mentioned above.

Offered solutions

factoHR offers the IT declaration solution to the employees in both web portal and mobile application, which is both Android and iOS compatible.

Regime selection

The solution offers a unique option to the employees to select the post and pre-budget calculations, i.e., old and new regimes according to the slabs they want to consider.

Projected and deducted amount

To know how much income tax is projected for the next month and deducted for the previous month, the solution has a separate option named “View tax calculation,” which shows the deducted income tax amount throughout the year along with the projection of the upcoming month. This assists them with the verification and filing of tax returns.

Online proof upload

factoHR’s feature allows employees to upload all the proof related to the declarations they’ve made, that too in softcopy format. No need to get it print and submit in physical form. It is so easy as employees can capture and upload the proofs even through their mobile phones.

Availability of all income categories

All the types of income which can be covered under the tax exemption are mentioned in the feature wherein employees can enter their exempted amount and attach proof for the required field.

IT forms generation

Compared to the manual method of asking HR for forms 16 and 24Q, employees can easily download these forms directly from their mobile apps or web portal. Apart from this, HR can share it from the software along with a digital signature attested.

Summing It Up

Technological advancement is deeply rooted in almost all the sectors where humans work, including business activities. factoHR has come up with a solution that is employee-centric and helps organizations boost their efficiency. The tax declaration solution we offer becomes beneficial to the HR managers at the time of the financial year-end when there are hundreds of tasks lined up to be completed.


To know more about the IT declaration feature and other modules, contact sales@factohr.com or +917820003100.


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