If you receive undue money, what would you do?
By dpk262006
@dpk262006 (58675)
Delhi, India
July 10, 2021 1:32am CST
In India Income Tax rates are high in comparison to other countries. The income tax is deducted by the employer for those who get salary from any organization/ Government Department. Thereafter, one is supposed to file an Income Tax Return to the Income Tax authorities, showing all his income from other sources, besides salary.
The other day my friend received a communication from Income Tax Authorities that there is refund of Income Tax on his previous years' Income tax as it was paid in excess by him. The amount was huge Rs.50000/- [US $671 approximately] .
The details of refund and his salary were given in the communication received. When he checked he found that his salary was shown incorrectly and therefore, they made a refund on his Income Tax paid by him.
He did not want to receive the refund, which was not due to him, therefore, he immediately wrote to the Income Tax authorities that there is some miscalculation on their part and no refund is due on the tax paid by him. Some friends suggested him that he should have received and kept the amount of refund, as it was not his fault, while some friends said it is better to inform the authorities that they have made the mistake.
If you were in my friends' place what would you have done? Had you kept the refund money with you or you would have informed the authorities of their mistake?
9 people like this
10 responses
@dpk262006 (58675)
• Delhi, India
12 Jul 21
Yes, sooner or later they may discover that they have wrongly refunded the money because every details regarding our income remains in their record. It is safer to return the money to them, which was not due. I hold the same view.
1 person likes this
@LadyDuck (459348)
• Switzerland
12 Jul 21
@dpk262006 I would surely not cheat with the Tax Office, you have to give the money back sooner or later.
1 person likes this
@dpk262006 (58675)
• Delhi, India
13 Jul 21
@LadyDuck It is great on your part that you won't like to cheat Income Tax authorities because we should accept what is due to us. Receiving undue amount could be cause of trouble later.
1 person likes this
@arunima25 (85649)
• Bangalore, India
10 Jul 21
I would not dare to do that to Income tax department. Sooner or later they would find it and then there would be more hassles and maybe penalty. Better to be fair. Your friend did the right thing.
4 people like this
@dpk262006 (58675)
• Delhi, India
12 Jul 21
It is better not to do anything with Income Tax Department. When they would have found out their mistake, they would have contacted you for return of money and that would have been embarrassing.
I hold the same view as you.
1 person likes this
@dpk262006 (58675)
• Delhi, India
13 Jul 21
@arunima25 Yes, you are very right. At a later date they won't admit their mistake but would question the individual that why did he keep the money. Moreover, there is no point receiving the undue money, which could cause trouble in future.
1 person likes this
@arunima25 (85649)
• Bangalore, India
12 Jul 21
@dpk262006 I would say that no panga with them. They are really strict with any fraud and sooner or later they definitely find out anything wrong. Better to have a clean reputation there.
1 person likes this
@ptrikha_2 (45563)
• India
10 Jul 21
I think in this case, the income tax department would have figured out the anomaly in the refunded and calculated amount may be later.
Returning the amount then would have been even tougher.
Informing the authorities in such a case is something that looks right.
3 people like this
@dpk262006 (58675)
• Delhi, India
12 Jul 21
Yes, you are right that later or sooner they would have find out their mistake and then they would have asked for return of the money and if my friend would have spent by the time they ask, then it would have a been a headache to return the money. It is better to play safe. I hold the same view.
1 person likes this
@ptrikha_2 (45563)
• India
14 Jul 21
@dpk262006
Yes indeed - better be careful !
1 person likes this
@dpk262006 (58675)
• Delhi, India
12 Jul 21
Yes, I also think that he did the right job and informed the Income Tax authorities regarding wrong credit of money. Now it is for Income Tax authorities to rectify their mistake.
@DaddyEvil (137142)
• United States
10 Jul 21
It's better to let them know of the mistake. Here, if the IRS makes a mistake, even though that's not your fault, they will want that money back plus fines. I always overpay my income tax so I get money back instead of worrying my employer didn't hold out enough. It's harder to come up with extra money in the winter, when out income taxes are filed, than it is to happily accept back the overpayment in taxes.
Some people here claim I'm stupid for overpaying. They say I'm giving my money to the government interest-free for the year. I don't care. I'd rather let them use it than make a mistake and have to find the money to make up for a short-fall when taxes are due.
2 people like this
@dpk262006 (58675)
• Delhi, India
12 Jul 21
Yes, that was the proper course of action to let them know about their mistake, instead of keeping the undue money.
It is wiser on your part that you do not mind paying extra Income Tax so that later, no one should point out that you failed to pay the the correct amount of Income Tax..
I do not agree with those who say that you are paying the interest free money to the Government, when you pay your advance tax. The issue is not of interest, the issue is - we want peace in our life and do not want to face problems with Income Tax Department.
that you do not mind paying extra Income Tax so that later, no one should point out that you failed to pay the the correct amount of Income Tax..
I do not agree with those who say that you are paying the interest free money to the Government, when you pay your advance tax. The issue is not of interest, the issue is - we want peace in our life and do not want to face problems with Income Tax Department.1 person likes this
@sulynsi (2671)
• Canada
10 Jul 21
I tend to agree - the amount if interest you would make is so small it really isn't worth the worry.
For me, I love getting a nice lump sum back when refund time comes. It's not taxable income, there's no taxable interest on it - its like having a little nest egg. It can be hard to save, this is a way to do it.
2 people like this
@DaddyEvil (137142)
• United States
11 Jul 21
@sulynsi True... My daughter and I always talk it over and decide if there's anything we need to use the money for when we get it every year. If there is, there we go. Most of the time there isn't, so it stays in my checking account until we do need it for something.
1 person likes this
@Butterfingers (66585)
• India
10 Jul 21
I would have informed them about the mistake and won't take the refund
3 people like this
@dpk262006 (58675)
• Delhi, India
12 Jul 21
It is good that you would have informed them and would not have waited for their communication regarding wrong credit.
1 person likes this
@allknowing (130165)
• India
11 Jul 21
There is yet another category to which I would like to belong Just take the refund without checking the details
1 person likes this
@dpk262006 (58675)
• Delhi, India
13 Jul 21
@allknowing Actually, they also sent salary details along with the refund communication, which clearly showed that total amount of taxable salary was shown incorrectly, which caused the refund. But they may rectify the mistake any time and then they would demand their money back.
1 person likes this
@allknowing (130165)
• India
12 Jul 21
@dpk262006 The law is in my favour as there is no clause where it says 'subject to the receiver having read the details"
1 person likes this
@allknowing (130165)
• India
13 Jul 21
@dpk262006 One is not obliged to read those details according to me. Also many a time these tax matters are so complicated that one takes their word for it
@dpk262006 (58675)
• Delhi, India
12 Jul 21
Yes, it is better to inform them of their mistake. I hold the same view. Informing them would save us from any future problem.
1 person likes this
@sabtraversa (13032)
• Italy
10 Jul 21
We seem to all agree. Authorities are allowed to make mistakes, we don't. 
I would have done what your friend did.
I would have done what your friend did.2 people like this
@sabtraversa (13032)
• Italy
11 Jul 21
@DaddyEvil Then, if the Italian IRS contacts me, I'll give your name. 
1 person likes this
@DaddyEvil (137142)
• United States
11 Jul 21
@sabtraversa *sigh* I knew you'd catch on... 
1 person likes this
@DaddyEvil (137142)
• United States
11 Jul 21
Or, and this is just a suggestion, you could give your overage to me. 
2 people like this
@dpk262006 (58675)
• Delhi, India
12 Jul 21
It is good on your part that you would have informed the authorities that you have wrongly received the amount, which was not due to you.
Yes, there is no point keeping that money, which is not ours.
Yes, there is no point keeping that money, which is not ours.1 person likes this
