Tds

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

19 December 2011 Dear Sir,

Please let me know if TDS is applicable on advance salary given to the employees in the financial year, where advance will be deducted in installments from the regular salary of the employees. If there is still excess loan (advance salary) unadjusted in the financial year which means the loan (advance salary) can only be adjusted in the next financial year. What is the computation.

Sambu Suresh

Sambu Suresh (Expert)
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19 December 2011 As per section 15 of the income tax, salary is taxable either on due or receipt basis whichever is earlier.

Suresh sambu

Guest

Guest (Expert)

19 December 2011 TDS not applicable on advance salary.

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anurag

anurag (Expert)
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20 December 2011 @ Sambu
Tds provision for salary are fundamentally different from tds provision of other payments. Unlike the provisions of TDS pertaining to payments other than salary where the obligation to deduct tax arises at the time of credit or payment, which ever is earlier, the responsibility to deduct tax from salaries arises only at the time of payment.Sec 15 is quoted correctly ,it deals with taxability of salary income but we are concerned with tds deducted on salary, upon which sec 15 is not applicable.
@ Neha
TDS will be deducted on advance salary.(Sec 17(1)(v)of Income Tax Act 1961.
Thanks and Regards.

Abhishek Ranjan Singh

Abhishek Ranjan Singh (Expert)
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20 December 2011 @ Neha Mam & Aurag

Salary is taxable on due or payment which is earlier.

Practically Employer do not deduct TDS on Advance salary because it is part payment.

Querist : Anonymous

Querist : Anonymous (Querist)

20 December 2011 When advance on salary is given it becomes part of the gross salary for the particular financial year, as per the tax slabs accordingly TDS has to be deducted on gross - even though not deducted while making the payment of advance on salary?