Archive · 20 Jul 2026
Job Switch Leads to Unexpected Tax Liability
When someone changes jobs in the same financial year, both employers calculate taxes only on the salary they pay.
This can lead to a surprise tax bill at the end of the year.
For example, an employee earned ₹7 lakh from the first job and ₹18 lakh from the second job.
The first employer didn't deduct any tax, and the second employer deducted ₹1.51 lakh.
But when the tax department looked at the total income of ₹25 lakh, they found that more tax was due.
The employee had to pay an extra ₹1.69 lakh.
To avoid this, employees should give their new employer details of their previous salary using Form 12B (or Form 122).
This helps the new employer calculate the correct tax from the start.
An employee who switched jobs in FY 2025-26 faced an unexpected tax liability of ₹1.69 lakh.
The first employer paid ₹7 lakh with no TDS, and the second employer paid ₹18 lakh with ₹1.51 lakh TDS.
The total tax liability was ₹3.20 lakh, but only ₹1.51 lakh was deducted as TDS.
Employers calculate TDS only on the salary they pay, not on the combined income from both jobs.
Employees should submit Form 12B (or Form 122) to their new employer to avoid such tax surprises.
- Who
- An employee who switched jobs during the financial year
- What
- An unexpected tax liability of ₹1.69 lakh due to incorrect TDS calculations by employers
- When
- Financial Year 2025-26
- Where
- India
- Why
- Employers calculated TDS only on the salary they paid, not on the combined income from both jobs
- Employee's Total Income
- ₹25 lakh
- First Employer's Salary
- ₹7 lakh
- Second Employer's Salary
- ₹18 lakh
- First Employer's TDS
- ₹0
- Second Employer's TDS
- ₹1.51 lakh
- Total Tax Liability
- ₹3.20 lakh
- Additional Tax Due
- ₹1.69 lakh
- Form for Combined Income
- Form 12B (or Form 122)