TDS on SALARY

This query is : Resolved

CA.DURGESH MISHRA (Querist)
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11 February 2011 There is a Public Sector Comapny.

Period of salary is from 1st to 30th of the month.

But due to manual working and problem of compilation of record ,salary slip is printed on or after 10th of following month.

and thereafter SALARY is debited to P&L A/C
but Entry is booked on 30th of that month.

then Company get information about
How much tax to be deposited u/s 192

And then Tax is deposited .

Now auditor has objection that " Since Salary is booked lets say 30 jan 2011,therefore it should be deposited to Govt. with in 7 days of that.
Whereas Co. is depositing after 10th Feb 2011

PLEASE ADVISE WHAT CAN COMPANY DO IN THIS SITUATION ?

Sunil Kr. Sanganeria

Sunil Kr. Sanganeria (Expert)
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11 February 2011 It is less important when you have printed salary slip.

One has to see the date of payment of slary or date on which entry passed in the Book.

The date whch is earlier would be considered and tax has to be paid within 7th of the next month.

It appears that you have paid salary on 30th jan but due to some problem salary slip printed on 10th Feb. In this case you should pay on or before 7th February.

Your Auditor is right.

CA.DURGESH MISHRA

CA.DURGESH MISHRA (Querist)
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11 February 2011 THANK YOU SIR FOR YOUR REPLY.

SIR ,
BUT IN OUR ORG SAY FOR MONTH OF JAN 2011

TILL 5 FEB WE COLLECTED ATTENDANCE SHEET FROM VARIOUS UNIT FOR THE PERIOD 1 JAN-30 JAN

THEN SALARY SLIP GOT PRINTED AND DISTRIBUTED TO ALL THE EMPLOYEE IN ORDER TO CONFIRM ALL THE DETAILS IS CORRECT , AND IF SOME CORRECTION NEEDED ,THEN REPORT .

IF EVERY THING IS OK THEN CD IS GIVEN TO THE BANK FOR ITS POSTING. ( Around 10 Feb 11).

Then only we get How Much tax to be Deposited U/S 192 and accordingly deposited on 11 feb

Now please advise .

Asha Kanta Sharma

Asha Kanta Sharma (Expert)
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27 July 2025 Thanks for explaining the process clearly.

Let’s analyze your **TDS compliance under Section 192** in light of the **salary payment timeline**.

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### 📌 Key Rule:

As per **Section 192** of the Income Tax Act:

> TDS on salary is to be **deducted at the time of payment**, not at the time of accrual or booking.

And as per Rule 30 of the Income Tax Rules:

> The deducted TDS must be **deposited to the government by the 7th of the following month** in which **salary is paid**.

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### 🔍 Your Case:

* Salary **period**: 1 Jan to 30 Jan
* Salary **processing**: Delayed due to manual collation, completed around **10 Feb**
* Salary **payment**: Done after bank CD is issued — say **10 Feb or later**
* TDS **deposited**: 11 Feb

### ✅ Conclusion:

* Since **salary was actually paid on or after 10 Feb**, TDS was **rightfully deductible** at that time.
* So, the **due date** for TDS deposit would be **7th March**, **not 7th February**.
* Hence, your **TDS deposit on 11 Feb is well within time**.
* Your auditor is **wrong in assuming the booking date (30 Jan)** is relevant — it is **not**.

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### 💡 Suggested Documentation:

To avoid future disputes, maintain this audit trail:

1. Attendance collation records with timestamps.
2. Internal emails/notes confirming salary sheet finalization.
3. Salary slip issuance and employee acknowledgment dates.
4. Bank debit advice (or payment confirmation) indicating actual **payment date**.

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### ✅ Final Advice:

You are **in compliance** with the law as long as:

* Salary was actually **paid after 7 Feb**, and
* TDS was deposited **within 7 days from the end of the month in which salary was paid**.

You may want to explain this formally to your auditor, referencing:

* **Section 192** – “at the time of payment”
* **Rule 30** of Income Tax Rules – payment-based due date

Would you like help drafting a short note to explain this to your auditor?

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