A survey conducted by the Income Tax Department on several paying guest accommodations in and around the city found multiple violations on part of the owners. A majority had not filed tax returns and over 80% did their transactions in cash, said a press release from the IT department.

The department is now organising an outreach programme for people running PG accommodations at SBR Palace in Marathahalli on February 20. Most of these paying guest businesses are unregulated and found to be violating multiple laws, including provisions of the Income Tax Act. No record of receipts are maintained systematically. The occupants normally pay a deposit, which varies from one to six months of rent in cash.

In some cases, there are neither receipts given for such deposits nor any refunds given as various charges are deducted when the occupants leave the PG, the release said.

During the survey conducted by the IT Department, it was observed that many PG owners do not file returns although most of them have income above taxable limits. Many PG owners are also guilty of systematically destroying records to evade tax. “Paying guest accommodation owners are required to comply with the provisions of the Income Tax Act and pay due taxes. Failure to do so will attract penalty and prosecution,” said the IT Department in a release.