Chartered Accountant
136 Points
Joined November 2010
As per Section 192 the employer is required to calculate tax liability of the employees taking into account other income or benefits which the employee is likely to receive during the financial year and also after taking into accounts the the relevant deductions for which the employee would be eligible. These other information would be furnished by employee to employer. And, that tax liabilites will be deducted by employer in equal installment from monthly salary of the employee and pay it to the credit of central government.
You need to bear in mind that tax liabilities include Education Cess and also Secondry Higher Education Cess at the rate of 2% and 1% respectively. So while computing the Tax Liability of your employee you need to include Education Cess and Secondry Higher Education Cess in it. Futher, there is no seperate limit for charging Education Cess and Secondry Higher Education Cess. Its levialbe once any person (including an individual) is liable for income tax.