Can paying adv tax save us

Sir,

Ask her to pay advance tax.

Then u cannot be held liable for non deduction of TDS.

https://www.thehindubusinessline.com/2008/05/24/stories/2008052450150900.htm

Originally posted by : manish bhura
	Dear all, We are a semi-govt society and all employees are contractual (11 mth contract renewed yearly) We have not applied for TAN no as salay of only one employee comes under taxable purview. (She is a lady) This employee is paid fixed salary 20000 pm and has not made any allowable investments. After considering Professional tax (200 pm) and rent paid (rent receipts provided) her taxable liability comes to around 2500/- (twenty-five hundred). My question is should i insist this employee to pay advance tax of 2500/- by 15th march or wait till she files her income tax return. I've heard that advance tax may be paid if tax liability is 5000/- or more. Also interest is chargable if this is not paid by 15th of every quarter. In our case, does interest apply as the employee falls into taxable bracket only in forth quarter (60,000;1,20,000;1,80,000;2,40,000). We know as employer we need to deduct TDS however now nothing can be done as without TAN we wont be able to do the same. Please guide us. Thanks in advance.

 So i understand that if the employee pays adv tax by tomorrow we need not deduct TDS.

I'm just concerned how AO will take this as i understand that as an employer per se we are assess in default for not deducting TDS. Also, as she has not paid adv tax before in this FY will there be any interest on adv tax deposite tomorrow.

I know as the amt is trivial this wont be an issue. however inquiring just out of academic interest.

Waiting for more claficiations and views on this.

Thanks in advance for your ineterst and help

Originally posted by : Uday Kiran
	You can avoid the penalty if you show to the satisfaction of assessing officer that there was reasonable cause for such failure.

 That's what i want to confirm.

If i make the employee pay adv tax in by 15th march. and do not deduct TDS from her march salary as she has already paid her due tax (albeit i will take decleration of income and tax payable from her with substantiating docs) do you think this is a resonable cause of not deducting TDS on my end.

Please give your view as i'm in a dilemma whether to insist for adv tax 2morow itself or plan for some other way out of this.

other option is ask the lady to save Rs25000 under section 80c to avoid the situation. moreover the finance act 2009 has incereased limit from Rs5000 to RS 10000 for advance tax.

Originally posted by : ca.vijay singla
	other option is ask the lady to save Rs25000 under section 80c to avoid the situation. moreover the finance act 2009 has incereased limit from Rs5000 to RS 10000 for advance tax.

Thax for the suggestion however if that could be done we would have done if first.

To put it in brief, i understand from this discussion we as employers cannot get away from our responsibilty of deducting TDS unless we have resonalbe reasons for not doing so. (as rightly pointed out by you like showing permissable investment)

Still one thing needs to be made clear,

If she pays adv tax today and i do not deduct TDS on basis that she has already paid her due tax and i do not have TAN. Is this advisable or will this have no impact and i should start procedure for allotment of TAN by today itself.

Experts are requested to throw some light on this as non-deduction of TDS is rampant in small semi govt. organization.

Waiting for some inputs and many thax to all who took time and efforts to asnwer us.

Dear manish ,  i think depositing of advance tax will not the serve the purpose. Because the employee may have deposited the advance tax if she has income from any other source  other than salary. pls take the case of contractor,professional if any person make payment  to them more than the specified amount in act  , it is mandatory for the person to deduct the tax at source even if income of the contractor,professional is less than the taxable income.  this is my personal view.

Employees at times also give particulars of other income accruing to them eg. in case of income from house property or income from other sources to their employers and employer after considering those other income compute the tax liability of the employees during the year so if employee furnish the proof of tax deposited by him or her then employer is suppose to consider them in the final calculation and it also relieve the employer from the liability of TDS if tax on salary including tax Paid on other income is sufficient to cover the Full Tax Liability. No interest is payable by employee on advance payment of tax if the tax payable by him of her is not more than Rs. 5000 (Increased to Rs. 10000 now)