How To File Form 10e For Tax Relief On Salary Arrears

How to File Form 10E for Tax Relief on Salary Arrears?

The income tax department ensures equitable taxation by protecting salaried individuals from undue tax liabilities on arrears payments.

Written by : Knowledge Centre Team

2025-12-24

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7 minutes read

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When employees receive arrears for previous years, the resulting tax calculation can feel overwhelming. This is especially the case if the additional income significantly increases the payable tax. Recognising this challenge, the Income Tax Department offers a mechanism that helps taxpayers manage such situations fairly. 

Form 10E enables employees to claim relief under Section 89(1) and helps recalculate the tax impact by adjusting the arrears across earlier years. Filing this form correctly is necessary before submitting the Income Tax Return. With clear guidance, the process becomes straightforward and ensures that employees do not pay more tax than they should.

Key Takeaways
 

  • Form 10E is required to claim tax relief under Section 89(1) on salary arrears, advance salary, or other delayed income
  • Section 89(1) provides relief by helping you recalculate tax liability
  • Section 89(1) distributes the tax burden across multiple years, preventing an increase in tax liability in a single year
  • File Form 10E before submitting your ITR, or relief under Section 89(1) may not be granted by the tax department
  • You can file Form 10E on the Income Tax e-Filing Portal and ensure that the information matches the details in Form 16

What is Form 10E? 

It is mandatory to fill out Form 10E if you want to claim tax relief under Section 89(1) of the Income Tax Act 1961. This form is used by taxpayers who have received delayed salaries in the form of arrears in a particular year. Any arrears received are reflected in Part B of your Form 16.

10E Form of Income Tax is required for furnishing particulars of received income under Section 192(2A) and can be filed by a Government servant or any employee working in a company, cooperative society, university, local authority, institution, association, or body.

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Why is Form 10E Required for Tax Relief?

Form 10E ensures fair taxation so that assesses do not face undue burden when they receive salary arrears. The following points elaborate on the benefits of this tax document:

  • Tax Relief on Salary Arrears: When an employee receives arrears or past dues in a lump sum, it may push them into a higher tax slab. Form 10E helps distribute the tax burden across the years in which the income was originally due.

  • Compliance with Section 89(1): Section 89(1) allows taxpayers to recalculate tax liability for past years in which the income should have been received. To claim this relief, Form 10E must be filed online before the Income Tax Return (ITR).

  • Prevents Excess Tax Deduction: If an employer provides arrears without considering Section 89(1), the Tax Deducted at Source (TDS) may be higher. Filing Form 10E ensures the taxpayer receives relief and avoids excess TDS deduction.

  • Mandatory for Claiming Relief: The Income Tax Department does not process relief claims in ITR without Form 10E. If a taxpayer claims relief without submitting this form, they may receive a notice from the IT department.

How to File Form 10E?

Filing Form 10E is a straightforward online process that helps claim relief on salary arrears. The form must be submitted on the Income Tax Department’s e-filing portal. Having your salary details, arrear breakup, and Form 16 ready beforehand ensures accuracy and avoids discrepancies.

Interested in availing the above-discussed benefits of Form 10E and streamlining your tax burden? Follow these steps to get started:

Step 1: Log in to the Income Tax e-Filing Portal

Visit the official Income Tax e-Filing portal (https://www.incometax.gov.in) and enter your User ID (PAN), password, and CAPTCHA code to log in. Ensure that your account is linked to Aadhaar and a valid mobile number for OTP verification if required.

Step 2: Navigate to 'File Form 10E'

Once logged in, go to the ‘e-File’ tab on the dashboard and select ‘Income Tax Forms’ > ‘File Income Tax Forms’. In the search bar, type "Form 10E", select the relevant Assessment Year, and proceed.

Step 3: Fill in the Relevant Details Under Section 89(1)

Provide details of salary arrears, gratuity, or compensation received in the respective financial years and calculate the tax relief accordingly. The system may require you to enter income details for previous years to assess the relief under Section 89(1).

Step 4: Verify and Submit Form 10E

After reviewing the entered details, click on ‘Preview & Submit’ to ensure all information is accurate. Finally, use your Aadhaar OTP, Digital Signature Certificate (DSC), or Electronic Verification Code (EVC) to complete the submission.

* Please note that the following Annexes are available under the page menu:

  • Annexure-I: For Arrears or Advance Salary
  • Annexure-II: For Gratuity (Past services over five years but less than 15 years)
  • Annexure-IIA: For Gratuity (Past services for 15 years or more)
  • Annexure-III: For Compensation on Termination of Employment
  • Annexure-IV: For Commutation of Pension
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Did You Know?

Non-filing of Form 10E can lead to the denial of tax relief even if Section 89(1) applies

 

Source: Incometax

 

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Consequences of Not Filing Form 10E 

Filing Form 10E requires careful attention, as even small mistakes can lead to delays or denial of tax relief. Since this form directly impacts how your salary arrears are taxed, it is important to review all details thoroughly before submission. Consider the following aspects while filling out Form 10E for claiming tax relief on salary arrears:

  • You must file the 10E Form of Income Tax online on the Income Tax Department website

  • If you had claimed tax relief in the previous financial year but did not file Form 10E, you would receive a notice from the Income Tax Department for non-compliance

  • You must file the 10E Form Income Tax online before filing your Income Tax Return.

  • While arrears on salary may pertain to earlier financial years, you must choose the Assessment Year in which you have received the arrears while filling out Form 10

  • You do not need to attach any copy of the Form submitted with your Income Tax Return (keep a copy, however, for your record)

  • While your employer may ask for confirmation once you have submitted Form 10E, it is not mandatory to provide this form to your employer.

  • Tax relief under Section 89(1) is also applicable for Family Pension received in arrears.

  • There is no tax relief under Section 89(1) for VRS (Voluntary Retirement Scheme) compensation if you have previously claimed tax exemption on the same under Section 10(10C)

Important Things to Consider While Filing Form 10E

Filing Form 10E requires careful attention, as even small mistakes can lead to delays or denial of tax relief. Since this form directly impacts how your salary arrears are taxed, it is important to review all details thoroughly before submission. Consider the following aspects while filling out Form 10E for claiming tax relief on salary arrears:

  • You must file the 10E Form of Income Tax online on the Income Tax Department website

  • If you had claimed tax relief in the previous financial year but did not file Form 10E, you would receive a notice from the Income Tax Department for non-compliance

  • You must file the 10E Form Income Tax online before filing your Income Tax Return.

  • While arrears on salary may pertain to earlier financial years, you must choose the Assessment Year in which you have received the arrears while filling out Form 10

  • You do not need to attach any copy of the Form submitted with your Income Tax Return (keep a copy, however, for your record)

  • While your employer may ask for confirmation once you have submitted Form 10E, it is not mandatory to provide this form to your employer.

  • Tax relief under Section 89(1) is also applicable for Family Pension received in arrears.

  • There is no tax relief under Section 89(1) for VRS (Voluntary Retirement Scheme) compensation if you have previously claimed tax exemption on the same under Section 10(10C)

Who Should File Form 10E?

Individuals should file Form 10E income tax if they have received any of the following payments: 

  • Salary arrears

  • Advance salary

  • Commuted pension arrears

  • Family pension arrears

  • Gratuity

  • Compensation for the termination of the job

Final Thoughts 

Section 89(1) offers substantial relief to taxpayers who face the impact of receiving salary arrears that need to be accounted for in the current fiscal year. The financial impact is significant until you apply for relief under Section 89(1) of the Income Tax Act, 1961. The steps mentioned above will help you file and submit Form 10E online to claim tax relief under Section 89(1) of the Income Tax Act 1961. 10E Form of Income Tax must be filed if you wish to reduce your tax liability on the salary payments received as arrears. 

If you have any issues, concerns, or doubts related to Section 89(1), Form 10E, or tax filing, you must consult an expert to ensure you file the Income Tax Return correctly without any hassles.

Understanding Form 10E also plays an important role in understanding your savings and further financial planning. At Canara HSBC Life Insurance, we offer plans that support you by ensuring a seamless savings and financial planning journey. Learn more about our insurance plans today.

Glossary:

  • Arrears: Income received for a past period, not paid when due
  • Section 192(2A): A provision of the Income Tax Act specifying tax treatment for employees receiving salary arrears or advances
  • Gratuity: A lump sum payment made by an employer to an employee upon retirement or resignation as a form of service appreciation
  • VRS: It is an employer’s offer to employees, typically older ones, to retire voluntarily, often with financial incentives
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FAQs

No, it is not compulsory to file Form 10E if you do not claim relief u/s 89(1) of the IT Act, 1961. Form 10E is specifically required only when claiming relief for arrears under this section.

The last date for filing the Form 10E claims is the same as filing the ITR during the assessment year specified by the government of India.

Form No. 10E is a declaration that an employee files to claim tax relief under Section 89(1) of the Income Tax Act, 1961. It is used when the salary is received in arrears, advance salary, or certain retirement-related payments in a later year than when they were due.

Form 10E can be filed online on the Income Tax Department's official e-filing portal or physically submitted at the designated Income Tax office. It's important to ensure all details are accurately filled in to claim relief under Section 89(1) of the Income Tax Act, 1961.

The Income Tax Department requires individuals to submit Form 10E for relief under Section 89(1). This section allows for recalculating taxes for the year the arrears were originally due and the year in which they were received, ensuring appropriate tax relief.

Form 10E can be filled a government servant or any employee working in a company, cooperative society, university, local authority, institution, association, or body.

You need documentation showing the arrears or delayed salary payment, such as a revised salary slip, an employer arrears statement, or Form 16 with Part B entries. You also need your prior years’ income details (salary, allowances, deductions) for the years in which the arrears were originally due. This is because Form 10E requires a year-wise breakup of income to compute tax relief under Section 89(1).

 

Yes, you log in to the official e-Filing portal of the Income Tax Department, go to e-File, then Income Tax Forms, and from there select File Income Tax Forms. Select Form 10E for the relevant Assessment Year, fill in the arrears/advance details (year-wise), preview, and submit. After submission, the form is stored, and then you can file your ITR with the relief claim.

If you fail to submit Form 10E before filing your ITR, the tax-relief claim under Section 89(1) may be denied by the Income Tax Department.

The relief can be rejected if the arrears breakup is incorrect, if the income details do not match Form 16 or ITR, or if Form 10E is not submitted before ITR. The department checks accuracy and consistency before granting Section 89(1) benefits.

Disclaimer - This article is issued in the general public interest and meant for general information purposes only. The views expressed in this blog are solely those of the writer and do not necessarily reflect the official policy or position of Canara HSBC Life Insurance Company Limited or any affiliated entity. We make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability, or availability with respect to the blog or the information, products, services, or related graphics contained in the blog for any purpose. Any reliance you place on such information is therefore strictly at your own risk. You should consult with a qualified professional regarding your specific circumstances before taking any action based on the content provided herein.

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