Salary and commission in same firm

TDS 803 views 2 replies

Jayesh

Self Employed

34 Points Joined November 2013

(Message modified for quick reading)

Hi Mates,

Good day to you all. I had a small clearification to do.

As per my knowledge; Salary and Commission drawn from same firm by the employee is clubbed to Gross salary of the employee. Please correct me, if am mistaken.

I am a Salaried Employee of XYZ Pvt Ltd.
My company issue Salary, after deducting Professional Tax. (they dont do TDS on salary yet)
Apart from Salary, I am entitled for sales commission from same company.
While issuing me cheque for Sales commission, they deduct TDS 10% u/s 194H.

I doubt, if these things are going OK..?

I request all your advice; to ease my concern.

I also have an another idea:

I am thinking to operate a Business and issue Bill to my company.

In this way, I can show business expenses also,

I request all your advice.

Regards. Thanks in advance.

Replies (2)

Mihir

Wealth Manager

5293 Points Joined December 2008

Commission is liable to TDS. The current arrangement is better than you raising bill for professional services replacing salary where they will again deduct TDS; whereas right now TDS is not deducted from your salary. And if you go by your new idea, you will have to file ITR-4.

Jayesh

Self Employed

34 Points Joined November 2013

Hi Mr. Mihir, Thanks for your reply.

The reason of new Idea is; I can claim refund and show Business Experiences if I am operating as Business and Profession. As a salaried, I cannot do so.

Also Mr. Mihir, is TDS on commission applicable even if its paid to employee..? under which section its Deducted..?

I had a doubt that, if an employee is entitled for commission; than the commission becomes a part of its Gross Salary; so if any TDS deducted, may be u/s 192.