TDS not deducted on Salary

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CA Ankit Verma (Querist)

21 July 2009 An assessee receives a cheque of Rs. 20000/- p.m from her company without any biferfication of this income like Basic, DA, HRA,..etc. and the Co. has not deducted TDS on her salary & she does not even receives Form-16 from her Co.

Now my questions are:

[1] Can an employee ask for Form-16 from his/her Co. even if she is employed without any salary biferfication ?

[2] Since TDS has not been deducted was the employee liable to pay Advance Tax ?

If yes then now will she be liable to pay Interest on such Advance Tax which was Payable?

[3] Or Is it ok if she now, while filing the return, pays off the self-assessment tax liable and its all over?

Please also tell me
[4] Is it employer's responsibility to deduct TDS from an employee's salary ?

If Yes, then it is not an employee's fault and then why should she bear Interest on Advance Tax if payable payable on above case?

[5] In above case if the Net Taxable income after giving effect of "Deductions under Chapter VI-A" is below exemption limit, is she still liable to pay Interest u/s 234 A,B,C on such advance Tax which she was liable even though she is not having Tax liablity on Net Income ?

Please Guide me...
Thanx in Advance..:)

Abhishek Mohta

Abhishek Mohta (Expert)

22 July 2009 I will be answering each question separately:

1. Issue of Form 16 by the employer is not depended on what biferfication the salary of employee consists. It may be that there is no biferfication at all and that the total salary is only basic salary. so she can ask for Form 16.

2. An assessee has to assess his/her income every quarter and pay advance tax if he/ she thinks that sufficient TDS wont be deducted from his/her income. So yes, she was liable for Advance Tax.

Yes, she will be liable to pay Interest U/s 234b, 234C for non-payment and deferment of advance tax.

3. She has to pay self assessment tax along with the interest amount while filing the return.

4. It is the responsibility of the employer to deduct TDS from salary and if he doesn't then he has to pay interest on the same and the expense is disallowed.

The question of responsibility is that the employee has to make sure that proper tax is deducted at source for her income or she should have paid advance tax within due date. So she has to pay interest.

5. If the taxable income is lower than the exempt limit then no question of TDS and Advance tax comes up and thus neither employer nor employee has to pay any interest.

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