Tds on salary

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My fellow employee gets a salary of 25000 per month.. His salary is credited directly in his bank a/c. he didnt want us to deduct tds on salary for the financial year 2011-2012 as he fears that he has a bank loan based on his salary and it would cause hard ship to him if tds was deducted.

But he accepts that he will give us a cheque for the actual Tds which ought to be deducted on his salary..

My question is

1) whether the contention of employee is accepted??

2) If so, what entry shouuld be made in the books for tds deducted??

Replies (4)
No.. You should deduct the tds otherwise co. may have to pay penalty and expenses for the same may be disallow. N i think if employer have some investment u/s 80C than i dont think u ll have to deduct tds and on the hand bank will consider only take home salary for loan purpose

Rs. 300,000 pa comes in tax bracket.

If he can provide you any written proof that his tax liability is NIL because he has invested in 80C, then you don't have to deduct TDS.

If not, then you have to deduct TDS.

TDS means tax deducted at "source", which means he cannot pay TDS to the company, the company has to deduct TDS from his salary.

hello guys.. Im not askin whether to deduct tds or not..

I just wanna know whether instead of deducting tds, can a employee issue cheque in lieu of tds??

If so wats the entry for the chq issued by the employee??

no employer can not issue cheque in lieu of tds..

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