Tds on salary

This query is : Resolved

Sankar Chakraborty (Querist)
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15 December 2011 Dear experts,

we have a pvt ltd company and having an employee whose salary details per month as under:

gross salary = 17100/-
p.tax = 130/-
P.F = 1020/-

net pay / cheque amt. 15950/-

should we deduct tds on salary ?

please let me know

CMA. CS. Sanjay Gupta

CMA. CS. Sanjay Gupta (Expert)
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15 December 2011 If no other source of income TDS deduction is not required. Also here bonus is not considered.

Here net pay =15950
Annual =(15950*12)=191400
Deduction u/s 80C for PF Cont=(1020*12)=12240

Taxable Income =(191400-12240)=179160 i.e. below exemption limit of Rs 1.80 Lacs. Therefore, TDS deduction not required.

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Sankar Chakraborty

Sankar Chakraborty (Querist)
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15 December 2011

sir,

i knew that Gross salary is considered as per I.T. computation you have calculated on net salary so please confirm

the above employee is paid bonus as one month salary then need i deduct tds please confirm

CMA. CS. Sanjay Gupta

CMA. CS. Sanjay Gupta (Expert)
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15 December 2011 Dear Shankar

In gross salary there is P.Tax for which deduction is available u/s 16(iii) and PF Contribution of Employer is exempt from tax upto 12%. Only amount in excess of 12% will be taxable. Therefore you have to reduce these amount from salary. If one month salary is received as bonus then you will have to deduct TDS as the amount crosses Rs 1.80 Lacs.

Regards

@VaibhavJ

@VaibhavJ (Expert)
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15 December 2011 Dear Sankar

Gross : 17100
Less PT: 130

Taxble Income :16,970
PF employee : 1,020

Total Taxbal Income: 15,950.

Now to deduct tax or not depends upon joining month. If is from April then total taxable Income comes to 1,91,400.

However I assume that In Gross It also includes Conveyance/Transport Allowance of Rs. 800 pm. Hence Rs. 9600 to be deducted against the same.

So taxable Income will be reduced to Rs. 1,81,800.

If employee is Male & has given Investment Declaration of Rs. 1800 or above then no tax is deductible else tax to be deducted @ 10 % on Rs. 1,800/-

For female employee no tax to be deducted.

Thanks & Regards

Vaibhav Joshi

Sankar Chakraborty

Sankar Chakraborty (Querist)
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15 December 2011 thanks to both expert

Sankar Chakraborty

Sankar Chakraborty (Querist)
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15 December 2011 Better i am giving all details of salary as per salary sheet to know tds deduction exactly should or not

employee - male 38 years
basic - 6500.00
fixed DA 2000.00
HRA 4600.00
spl. allowance 4000.00
total 17100/-
deductions
p.tax 130
PF 1020
net pay 15950/- by cheque

please let me know to deduct tds or not ?

@VaibhavJ

@VaibhavJ (Expert)
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15 December 2011 Taxable Income will be Rs. 1,91,400

So if employee has worked for 12 months & he is male then Taxable Income will be RS. 11, 400/-

& TDS to be deduted @ 10% and amount to be divided by 12 (no. of moths till Mar 2012 form April 11) for arriving to monthly tax amount.

ie. Rs. 95 & Cess @ 3% to be added on it ie. Rs. 2.85

Total TDS is Rs. 98/-