20 May 2009
An employee in a company requests its Finance team to deduct TDS from July Salary onwards and not from Apr itsel. His total tax liability for the year will be more than 50000. Can the company do so or there is any rule that TDS be deducted every month? If Company agrees to his request, will not the provision of Advance Tax deposit be considered as not obeyed? Who will be considered as on defalut then?
20 May 2009
Hi TDS from the salary has to be deducted based on the estimated particulars given by employee, here particulars means investment proposals, LIC payments and others to cliam deduction u/s 80C. By considering the above particulars the employer has to deduct tax from the salry.
however employer may revise the TDS to be deducted based on the fact whether the employee acted according to the particular sgiven at the begining of the year.
Hence TDS to me made may differ from one month to another month, ultimately it has to reach the total tax liability to be deducted.
21 May 2009
I agree that total TDS should reach total tax liability. But I wants to know that if a company estimates an employees tax liability to be around Rs 1 lakh, is it necessasry to deduct TDS from Apr itself or on request of employee co. can start deducting his TDS w.e.f from July by increased amt so that total TDS till Mar be Rs 1 lakh? If it can be done, won't the provision of Advance tax deposit be missed out and who will be at fault then?
CAclubindia
