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TDS @ 20% on salary

Accounts Officer


Dear All

How Tds @ 20% is applicable on salaries and on what basis tax to be deducted

For Eg:- One employee is drawing monthly salary of 19000/- having no PAN

Which is the right option to deduct tax

A)19000*12= 228000 - 180000 =48000*20% =9600*3%=288 so total 9888/12 =824pm

B) 19000*20% = 3800

A or B is applicable ?, pls explain

 
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Internal Auditor


Option A is right. However, rate must be 10%(as per slab). Why are you applying 20%?

 
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Accounts Officer


Am not agreeing with you jayesh , pls read my querry fully

 
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If employee has not furnished his/her PAN no. then TDS will be deducted @ 20% which is higher than the apllicable rate of 10% in the present case. This is as per section 206AA.

Methodology A sholud always be followed for deducting TDS from salaries as tax is chargeable on "estimated net taxable income" after providing for all the allowable deductions under sectoin 80C, 80D, PF, etc. whichever applicable.

 
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1st option is right                           

 
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Internal Auditor


Hey Ajay, m sorry, 20% rate is correct (since PAN is not available). But still, option A would stand correct.

 
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Option A is OK.

 
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Senior Executive (Finance & Account)

Option A is right.

 
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MANAGER ACCOUNTS


My Dear friend , option( A) is always followed,if PAN number is provided....as per normal rate of tax....u should also considered,deduction of sec80.....

Option( B) is followed when no pan is provided...ie...Rate is 20%....

agree with,Mr Ravi.......


Total thanks : 1 times

 
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Accounts manager-MBA


agreee with ravi


Total thanks : 1 times

 
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