LIVE GST Certification Course by CA Arun Chhajer begins 27th April. Register Now!!

tds on salary

Aryan (Sr. Accountant) (242 Points)

06 August 2010

i want to know, when i deduct tds on salary, examp...if one personal are draw Rs.24,000/- Per month salary, he will be collect Rs.2.88 lac salary during the year...when i deduct his salary from 1st salary or he exceed 160000/- limit....when...i cant understand...??? please suggent me.

Reply
Follow
Share

8 Replies

vineet (article assistant) (46 Points)
Replied 06 August 2010

tds is deducted at the time making payment to employee. And it is deducted at an average rate calculated at the beginning of the year.

in ur case tax would be RS. 13184/-, divide this amt by 12 (months), and u ll get Rs.1099/-, so deduct this amt from 1st salary and pay the bal amt to employee.

1 Like

Manoj BG (Tax Professional and in Service) (1795 Points)
Replied 06 August 2010

AS VEENIT SAID, FIRST OF ALL, U HAVE TO CALCULATE THE ESTAMTED SALARY TO EMPLOYEE IN THE FINANCIAL YEAR. THEN U HAVE TO CALCULATE THE TAX AMOUNT WOULD BE ON THAT YEARLY TAXABLE SALARY. FINALY U HAVE TO CALCULATE AVERAGE RATE OF TDS AND THEN TDS SHOULD BE DEDUCTED AT THAT RATE.

FURTHER, IF DURING THE YEAR, THERE IS ANY CHANGE IN THE ESTIMATED TAXABLE SALARY BECAUSE OF BONUS OR OTHER EXTRA ALLOWANCES, TDS RATE WOULD HAVE TO BE REVISED AS PER WORKING GIVEN ABOVE. ANY SHORTFALL ON THE TDS DEDUCTIONS IN THE EARLIER MONTHS OF THE SAME FINANCIAL YEAR WOULD BE ADJUSTED IN THE COMING MONTHS EQUALLY.

HOPE THIS SOLVES U'R QUERY...

REGARDS,

MANOJ

1 Like

sivakumar (Asst Manager - F&A) (324 Points)
Replied 06 August 2010

These deduction only done by approximate deduction on every month or quarterly.

CA Trinath Galla (student) (3130 Points)
Replied 07 August 2010

Originally posted by : vineet
	tds is deducted at the time making payment to employee. And it is deducted at an average rate calculated at the beginning of the year. in ur case tax would be RS. 13184/-, divide this amt by 12 (months), and u ll get Rs.1099/-, so deduct this amt from 1st salary and pay the bal amt to employee.

CMA. Subhash Kumar Jha (General Manager - Finance) (8391 Points)
Replied 07 August 2010

TDS are to be deducted on monthly basis by estimated the annual tax liability & then dividing it by 12.

sudhir kumar (Accountant ) (25 Points)
Replied 14 January 2014

I Want to know, when I deduct tds on salary Exemp……if one personal are draw Rs. 30000 Per Month salary he will we collecte Rs. 360000.00 Salary during the year when I deduct his Salary from 1st Salary or he exceed 200000.00/- limit.. when I cant understand …??? Please suggest me

sudhir kumar (Accountant ) (25 Points)
Replied 14 January 2014

(Guest)

@ Sudhir

TDS is deducted at the time making payment to employee. And it is deducted at an average rate calculated at the beginning of the year. First of all calculate taxable liability on salary thereafter divide it in monthly basis

In the given case, tax would be RS. 16480/-, divide this amt by 12 (months), and u ll get Rs.1373/- (approx), so deduct this amt from 1st salary and pay the balance amt to employee.

1 Like