TDS on Salary


(Querist)
06 April 2010
Suppose X Ltd. booked salary payable for the month of March,2010 on 31.03.2010 of Mr.y Rs.100000/-. Mr. Y already received from x Ltd Rs.1100000/- in every month from 10.05.2009 starting for the month of April,09.(i.e April salary paid in May)
What amount to be considered for TDS purpose u/s 192 in this situation?
Whether X Ltd. liable to deduct TDS on Salary payable for the month of March2010?(If actual salary will be paid on 10.04.2010)


CA. Ashish Bihani (Expert)
06 April 2010
Yes, X ltd. is liable to deduct tax on salary payable for month of March also as the salary becomes due in March 10 itself.

DEBJIT MAJUMDER (Querist)
06 April 2010
X Ltd claiming that as per sec 192,TDS on salary is applicable on payment basis. Direct tax Ready reckoner also silent in this respect.As per act,it has stated on payment basis.
whether claim of X Ltd is correct?

CMA. CS. Sanjay Gupta (Expert)
06 April 2010
Section 192 casts the responsibility on the employer, of tax
deduction at source, at the time of actual payment of salary to the
employee. Unlike the provisions of TDS, pertaining to payments
other than salary where the obligation to deduct tax arises at the
time of credit or payment, which ever is earlier, the responsibility to
deduct tax from salaries arises only at the time of payment. Thus,
when advance salary and arrears of salary have been paid, the
employer has to take the same into account while computing the
tax deductible


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