E TS SALARIES

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

28 January 2010 If a compan pays salary on the 5th of each month and deposit the TDS on salary by 14th of the same month. Thus, salary for the month of June is paid on July 5th and TDS is deposited by July 14th.

Section 192 states that TDS is liable to be deducted on “payment” of salary. (unlike other TDS in case of salary the TDS is only on payment basis).

The query is that in case of e-TDS return, which months should be considered for each quarter? Eg: In case of Q1—If we take April to June then the date of deduction of June salary is July 5th which actually goes beyond the quarter.

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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28 January 2010 Realy your query is complicated

Sec,192 says tds to be deducted on the payment of salary.

My opinion you can make the provision on last day of the month itself

Aashok Kumar Sharma

Aashok Kumar Sharma (Expert)
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21 July 2024 In the context of e-TDS return filing, the consideration of months for each quarter typically aligns with the financial year quarters, irrespective of the actual payment and deduction dates of salary. Here’s how it generally works:

1. **Financial Year Quarters:**
- **Q1 (April to June):** For e-TDS purposes, this quarter includes salaries paid and TDS deducted for the months of April, May, and June.
- **Q2 (July to September):** This includes salaries paid and TDS deducted for the months of July, August, and September.
- **Q3 (October to December):** This includes salaries paid and TDS deducted for the months of October, November, and December.
- **Q4 (January to March):** This includes salaries paid and TDS deducted for the months of January, February, and March.

2. **TDS on Salary:**
- As per Section 192 of the Income Tax Act, TDS on salary is required to be deducted at the time of actual payment of salary to the employee, not when accrued or due. Therefore, if the salary for June is paid on July 5th, the TDS for that salary should ideally be deducted and deposited by July 14th.

3. **e-TDS Return Filing:**
- When filing e-TDS returns, you will report TDS deductions based on the financial year quarters mentioned above.
- For instance, when filing the e-TDS return for Q1 (April to June), you will report TDS deductions for salaries paid in April, May, and June, even if the salary for June was paid in July.

4. **Practical Consideration:**
- Despite the salary for June being paid in July, the TDS deducted on this salary should still be reported in the e-TDS return for Q1 (April to June). This is because the TDS deduction is linked to the month in which the salary pertains, not the actual payment month.

5. **Penalty and Compliance:**
- It’s crucial to ensure that TDS is deducted and deposited within the stipulated due dates to avoid any penalties or interest charges.
- The due dates for TDS payment and e-TDS return filing can vary, so it’s essential to adhere to the timelines set by the Income Tax Department to remain compliant.

In summary, for e-TDS return purposes, you should consider the salary month (April, May, June, etc.) for each respective quarter, regardless of the actual payment date of the salary. Ensure timely deduction and deposit of TDS to comply with tax regulations and avoid penalties. If in doubt, consulting with a tax advisor or using the services of a professional e-filing intermediary can provide clarity specific to your situation.

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