TDS ON SALARY INCOME

This query is : Resolved

satyavrat vasudevbhai barot (Querist)
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13 August 2010 WHETHER THE PROVISION OF 20% TDS, FOR NON SUBMISSION OF PAN, IS APPLICABLE TO SALARIED EMPLOYEES. MY ORGANIZATION HAS 1500 EMPLOYEES. I WOULD LIKE TO CLARIFY IN THE CASE OF AN EMPLOYEE WHO DOES NOT HAVE PAN, WHETHER TDS @ 20 % HAS TO BE MADE WHEN GROSS TOTAL INCOME, BEFORE CLAIMING DEDUCTION U.S. 80, EXCEEDS THE EXEMPTION SLAB BUT NET TOTAL INCOME, AFTER CLAIMING DEDUCTION U.S. 80 DOES NOT EXCEED THE EXEMPTION SLAB. MEANING THAT HIS NET TOTAL INCOME IS BELOW THE TAXABLE LIMIT.
PL. REPLY.
THANKING YOU.

taxindiaconnect

taxindiaconnect (Expert)
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13 August 2010 The section 206AA provides that the rate applicable of 20% which ever is higher shall be deducted from the payment. In this case if the employee is in the tax bracket of 10% or on the block of 10% tax rate, 20% TDS is required to be deducted from him.

CMA. Subhash Kumar Jha

CMA. Subhash Kumar Jha (Expert)
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13 August 2010 If the salary of a male employee is upto Rs. 160000/- & he does not have PAN, then no need to deduct TDS.

If the gross salary jumps the above figure , then irrespective of 80 C deduction, you should deduct TDS @ 20 %.