Tds

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$rishti Negi (Querist)

05 September 2012 If a company is paying salary to an employee of Rs. 23000/-P.M. in cash, but that employee is not liable to pay tax. So the Co. is not deducting TDS. My query is that co. should deduct TDS as it is paying cash more than 20000/-. M i correct?

Pankaj Gupta

Pankaj Gupta (Expert)

05 September 2012 As an employer a person is required to deduct TDS on the amount paid to his employee, only when, if the the total income of the employee is above taxable limit.
Payment in cash above 20000 is nowhere related to deduction of tds.

Ki$hor B

Ki$hor B (Expert)

05 September 2012 Agreed with the expert.

$rishti Negi

$rishti Negi (Querist)

05 September 2012 yes i agree with u but as per data given his total income during the year is more than 180000 (maximum exemption limit) but tds is not deductiable because due to deduction of 80C etc, now i want to now is employer liable to pay tax?

Pankaj Gupta

Pankaj Gupta (Expert)

06 September 2012 For deduction of tds, employe's expected taxable income is taken. Such income shall be computed on expected basis by giving all eligible deductions. Therefore if his expected net income after all eligible deductions is below taxable limit than tds is not required to be deducted.

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