Short Tds on salary

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This discussion addresses an employer's query about short-deducted TDS on employee salaries. The employer deducted less TDS than required for the last quarter but deposited an excess amount to the government. The core issue is how to rectify the short deduction from the employee's salary, as there are no further salary payments in that financial year. The consensus suggests adjusting the shortfall in the current month's salary or potentially in the next financial year's salary, as the employee will claim the full TDS amount in their tax return.

renu

renu (Querist)
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18 September 2020 Hello everyone
As there is a difference between short Tds deducted from salary and short Tds deposited, my query is regarding short Tds on salary deducted.

Being an employer, we deducted short amount of TDS from salary of an employee and paid him the net amount, for last quarter. But while depositing it to govt. we deposited some excess amount. So my query is now, how to adjust this short Tds deducted from employee salary, as we paid the balance amount to him and being last quarter no salary left where we can adjust this tds.

CA Raj Doshi

CA Raj Doshi (Expert)
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18 September 2020 You can adjust the same in the current month salary.

renu

renu (Querist)
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18 September 2020 Would it be correct to adjust this short tds in salary of next financial year? Or we should pass some adjustment entry on 31st March only

CA Raj Doshi

CA Raj Doshi (Expert)
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19 September 2020 Yes. There's nothing wrong. Wouldn't he claim the full TDS along with the excess paid in his IT return, so there is nothing wrong in adjusting in current salary.

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