Notice pay

TDS 671 views 2 replies

Ganesh

Software Engineer

31 Points Joined February 2009

My previous employer deducted the notice pay and he didn't deducted that amount from the From 16. Now i need to pay tax for the amount which i have not earned. My current employer is not ready to reimburse the notice pay. Now i am in to huge loss.

The amount deducted by the previous employer, becomes the income of the company and it is my expense. So the amount towards notice pay should be deducted from the calculating the net salary.

If some one in this group could explain me in detail.

Regards

Ganesh

Replies (2)

Robin K Garg

Manager

36 Points Joined February 2009

Dear Ganesh!

Every form 16 has a declaration by the signing person that the perticulars given in the same are true & correct as per issuer's record. You give a notice to your ex employer asking for issuing a correct form 16 otherwise warning him to file a complaint with Income Tax Department for issuing you a false form 16.

Regs,

Robin K Garg

V.K.SUBRAMANI

chartered accountant

56 Points Joined December 2008

SALARY IS TAXABLE AS INCOME EARNED NOT BY MEANS OF ANY DEEMING PROVISION.HENCE SALARY ACCRUED LESS NOTICE PAY IS TAXABLE AS SALARY INCOME. I WOULD SUGGEST YOU TO CLAIM DEDUCTION WHILE COMPUTING YOUR TAXABLE INCOME BY APPLYING SEC17(3)WHICH SEEKS COMPUTATION OF PROFIT IN LIEU OF SALARY.THE TERM 'PROFIT' INCLUDES 'LOSS' AS WELL.