Advance salary

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CA. Jyoti Baid (Querist)
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13 October 2009 Hello

A company has paid advance salary to its employees. Should TDS be deducted on the same.

Further, is advance salary allowable expenditure in the year of payment for the company.

Regards,
Jyoti

CA.Tarun Maheshwari

CA.Tarun Maheshwari (Expert)
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13 October 2009 TDS on Salary is applicable on payment basis. So, whenever you pay it, you need to deduct TDS, even if it is advance. And Salary in a company is booked on due basis. You should book the salary for all months and that shall be allowable expenditure. Advance can be adjusted only against that due salary. Deduction shall be of the salary due to that employee. I hope I am clear.

Sreedhar Atchutuni ACA,GradCWA

Sreedhar Atchutuni ACA,GradCWA (Expert)
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13 October 2009 TDS is deductible on payment basis for section 192. So, TDS has to be deducted for Advance Salary also.

Advance salary is not an allowable expenditure it comes under asset head Loans and advances against which salary due to employee has to be adjusted.

CA Devanshi Gandhi (Ajani)

CA Devanshi Gandhi (Ajani) (Expert)
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13 October 2009 agree with the experts

CA. Jyoti Baid

CA. Jyoti Baid (Querist)
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03 November 2009 THANKYOU FOR THE REPLY.

SHOULD PROFESSIONAL TAX BE DEDUCTED ON ADVANCE SALARY PAID OR IT SHOULD BE DEDUCTED ON DUE BASIS WHEN ADVANCE SALARY IS ADJUSTED FROM MONTHLY SALARY