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TDS on Gratuity

Jwalit D Sheth (Audit Assistant) (58 Points)

25 May 2011

I would like to know whether employer while paying Gratuity to his employee as per rules and regulations prescribed is liable to deduct TDS? if yes then what are the provisions relating to the same and what is the threshhold limit for the same (i.e TDS)

Please post your reply and notify me as early as possible

Thanks

With Regards

Jwalit Sheth

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9 Replies

Devendra (Chartered Accountant) (4775 Points)
Replied 25 May 2011

NO NEED TO DEDUCT TDS ON GRATUITY PAYMENT..

REGARDS,

DEVENDRA K

CA ADITYA SHARMA (CA IN PRACTICE ) (16719 Points)
Replied 25 May 2011

no TDS ON GRATUITY

Harpreet (* * * * * *) (1670 Points)
Replied 25 May 2011

Gratutiy is expempt income i.e. tax free income

Rahul (------------------) (24 Points)
Replied 25 May 2011

There is no requirement to deduct tds on gratuity amount.!

CA Chandrasekaran.S.R (Proprietor) (280 Points)
Replied 26 May 2011

If the rules and regulations referred tois of Gartuity Act then No TDS,To be precise payment of gratuity under the Payment of gartuity act is tax free and thus NO TDS

CA Deepak Joshi (TaxTalk) (178 Points)
Replied 26 May 2011

Err...I don't know why all people here are saying that gratuity receipt is tax free....the fact is that it is tax free only upto a limit prescribed under the law.....

As of now any gratuity recd upto 10 lacs is tax free income.....so if you are giving gratuity above this amt then you need to deduct tax under section 192 at the time of paymmet......as per the income slab....

2 Like

K.R.VASUDEVAN (DEPUTY GENERAL MANAGER(F&A)) (37 Points)
Replied 26 May 2011

gratuity paid up to 10 lakhs is exempted from tax . If payment is above Rs 10 lakhs TDS u/S 192 should be made

1 Like

Rup Kumar (finance manager) (288 Points)
Replied 26 May 2011

Agree with Deepak Joshi.

lalit (article) (36 Points)
Replied 16 November 2012

i want to know when gratuity is part of CTC, (if ctc 20000/- than 500/- is for gratuity) , mean amount of gratuity deducted from your salary , whether this deducted gratuity is goning to consider for the purpose of TDS ?