Since the amount disclosed in income chargeable under the head salaries is less than 90% of Salary reported in TDS 1, please ensure to fill details in Others in Exempt Income

Since the amount disclosed in income chargeable under the head salaries is less than 90% of Salary reported in TDS 1, please ensure to fill details in Others in Exempt Income – an error that many of salaried tax payers are facing while filing their income tax returns. In this post we tell you why you get this error and the way around.

Error while filing ITR - amount disclosed in income chargeable under the head salaries is less than
Error while filing ITR – amount disclosed in income chargeable under the head salaries is less than 90% …

How to Pay 0 Income Tax on Salary of Rs 20+ Lakh?

Salary components and salary structure plays a very important role in how much income tax you pay. We have come up with some optimised salary structure using which you pay NO income tax even with CTC of more than Rs 20 Lakhs.

Why the Error?

This error occurs when your gross salary as reported by your employer in Form 26AS is higher than the one quoted by you from Form 16 while filing your tax return.

Your Form 26AS numbers matches with what is quoted in Form 16 – Part A by your employer. Below is a sample:

Form 16 Vs Form 26AS
Form 16 Vs Form 26AS

While filing the return online, the ITR Form automatically picks up data from Form 26AS. You can check the same in Tax Details tab >> Sch TDS 1 as shown below

TDS 1 - Details of Tax deducted at Source from Salary
TDS 1 – Details of Tax deducted at Source from Salary

The above salary in the header “Income chargeable under salaries” is Gross salary (as can be seen in the Form 16 Part B below) but while filing your return, you need to put only your Net salary.

Net salary = Gross Salary – Tax Free Allowances

The error occurs when Net Salary is less than 90% of gross salary & you do not report the tax-free allowances in exempted income section of ITR

Like in this case the Gross Salary is Rs 15,86,610 and net salary is Rs 13,12,938. The percentage of Net to Gross salary is 83%. Since this is less than 90%, you get the error.

Gross Salary Vs Net Salary - Form 16
Gross Salary Vs Net Salary – Form 16

Here are some posts which can help you with e-filing of Income Tax Return:

to Correct the error?

The error is easy to correct. All you need to do is report your tax-free allowances in the exempt income section. This can be done as follows for ITR 1.

Go to Taxes Paid & Verification tab >> Exempt Income (For reporting purposes) >> fill (iv) others. As per the above Form 16, we have below 3 tax-free allowances

Tax Free Allowance in Salary
Tax Free Allowance in Salary

This is how we fill it in exempt allowance section:

Filling Exempt Allowance Section in ITR 1
Filling Exempt Allowance Section in ITR 1

If you notice there are several headers under exempt allowance, which you can choose as per your requirement. Below is the list of exempt allowances header in ITR 1.

Exempt Allowances that are available for ITR 1
Exempt Allowances that are available for ITR 1

I hope this post would help you to understand and resolve the error in ITR “The amount of salary disclosed in Income details/Part BTI is less than 90% of Salary reported in Schedule TDS1”.

55 thoughts on “Since the amount disclosed in income chargeable under the head salaries is less than 90% of Salary reported in TDS 1, please ensure to fill details in Others in Exempt Income”

  1. I filled Allowance to the extent exempt u/s 10 under Taxes Paid & Verification tab >> Exempt Income (For reporting purposes) >> fill (iv) others. But this amount is not refelected in the total taxable income. (I expect the exempt income should be dedcuted from Gross Salary and the income chargeble under the head salary should be calculated accordingly.

    But this is not happening, and hence my total tax calculated in ITR is more than the on in Form 16.

    Could you please help?

    Where we have to deduct the exempt income and put that figure in return

    1. It would not deduct automatically. In your salary you should deduct the exempt income and put that figure in salary.

  2. Manjunath Jogin

    Hi Amit,

    In my case it is like this
    tab “Computation of Income and Tax”, Income chargeable under the head “Salaries”(i+ii+iii+iv+v) = 7,00,000 ;
    tab “Tax Details”, Income chargeable under Salaries [col(3)]= 8,00,000.

    I am also getting same error

    I entered in “Tax Paid and verification as you mentioned.
    Now I am stuck up for next step, do I need to change value in tab “Tax Details”, Income chargeable under Salaries [col(3)]=7,00,000.
    Please let me know.

    Thanks,
    Manjnath

  3. Manjunath Jogin

    Hi Amit,

    it is not clear for me. Can you tell me little more detail how I can adjsust.

    Thanks,
    Manjunath

  4. Hi

    My head Salary ( Excluding all allowances ) is 6 lakhs but in TDS1 Income chargeable as 7.6 lakhs, resulting while submitting the ITR1, the error showing as “”Since the amount disclosed in income chargeable under the head salaries is less than 90% of Salary reported in TDS 1, please ensure to fill details in Others in Exempt Income””

    Pls help to resolve the same

  5. Hi,
    I have entered amt in exemption allowance under headers HRA, Leave Encashment. Can you please help under which headers, do EPF and Gratuity go? Will these come under”Any Other”.

    Thanks in Advance.

    Yashul

  6. Sir,

    Even I was getting same error as mentioned by you. Against tax details, against income chargeable under head salaries if i correct the income to the one mentioned in form 16 point 6 – then error is not appearing – can this also be done ?

  7. Hi Amit,

    In Tax details tab in ITR1, details of Tax deducted at source from Salary not showing full amount as it’s showing only 3 quarter of salary given to me by my company and last quarter income not coming even though in 26AS it’s showing full 4 quarter salary credited and tax deducted.
    So i have manually added 1 entry in of last quarter.is it fine or i have to contact my employer for the same.

  8. Hi Amit,

    I filled Allowance to the extent exempt u/s 10 under Taxes Paid & Verification tab >> Exempt Income (For reporting purposes) >> fill (iv) others. But this amount is not refelected in the total taxable income. (I expect the exempt income should be dedcuted from Gross Salary and the income chargeble under the head salary should be calculated accordingly.

    But this is not happening, and hence my total tax calculated in ITR is more than the on in Form 16.

    Could you please help?

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