08 June 2013
Yes, You Need to calculate Total tax liablity first, and if their income comes below 500000 then deduct rs. 2000 from their final tax liablity after that divide by 12 and dedcut that much TDS from every month salary.
as far as form 16 is concerned, dont worry, it will get change. that you have to bothered only in april 2014.
Applicable for A.Y.2014-15 , i.e, F.Y. 2013-2014, A ‘deduction’ is given under Chapter VI from the gross total income, but this is a ‘rebate’ under Paragraph A of Chapter VIII of the Income Tax Act, 1961 which is deducted from the income-tax payable.
Example:-
Applicable to resident individual having total income after chapter VIA(80c to 80U) is less than 500000,
You need to calculate income tax liability of individual on which rebate of rs.2000/-on tax liability is provided if his total income is less than 500000.
So if total income after (80c to 80U) deductions is 2,20,000 talx liability is Rs.2000 on which rebate under sec.87A is provided so net tax liability is Nil.
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