Leave encashment- practicle problem

Save Share

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

16 December 2011 Dear Sir,
A has gross salary of Rs. 1,70,000/- & co. paid him Rs. 10,000/- as leave encasement(still A is working for Co.) However Co. have not deducted tax at the time of payment of leave encashment. Are we require to deduct tax on these Rs. 10,000/- & if yes at what rate or as the gross salary is not exceeding the tax limit so no TDS is required.
2) While issuing Form 16 to employee should we include these 10000/- leave encashment to Gross salary .
Pls rply
Thanks:
Raju

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
Follow

16 December 2011 You have to include leave salary as a part of Gross Salary and if even after adding the leave salary , income of the employee is not
taxable, no need to deduct TDS on Salary in such case.

Message likes : 1 times

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now