Applicability of TDS

This query is : Resolved

Sandeep (Querist)
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21 October 2010 If a person is employed by an enterprise. He is paid salary as well as professional fees then how TDS to be calculated? Whether to deduct 10% from Professional and on balance as per salary?

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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21 October 2010 If you are having the separate service agreement for professional service, the TDS will apply u/s.194J

If the payment made in addtion to the salary without having any professional agreement, then TDS U/S.192

Aditya Maheshwari

Aditya Maheshwari (Expert)
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21 October 2010 “Salary”, “perquisite” and “profits in lieu of salary” defined.

3117. 32For the purposes of sections 15 and 16 and of this section,—

(1) “salary” 33 includes33—

(i) wages;

(ii) any annuity or pension;

(iii) any gratuity33;

(iv) any fees33, commissions, perquisites or profits in lieu of or in addition to any salary or wages;

(v) any advance of salary;

34[(va) any payment received by an employee in respect of any period of leave not availed of by him;]

(vi) the annual accretion to the balance at the credit of an employee participating in a recognised provident fund, to the extent to which it is chargeable to tax under rule 6 of Part A of the Fourth Schedule; and

(vii) the aggregate of all sums that are comprised in the transferred balance as referred to in sub-rule (2) of rule 11 of Part A of the Fourth Schedule of an employee participating in a recognised provident fund, to the extent to which it is chargeable to tax under sub-rule (4) thereof;

35[(viii) the contribution made by the Central Government 35a[or any other employer] in the previous year, to the account of an employee under a pension scheme referred to in section 80CCD;]

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taxindiaconnect

taxindiaconnect (Expert)
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25 October 2010 As an employer you need to deduct TDS from the income of you employee which comes to your knowledge either by declaration by employee or by otherwise. So in this case add the salary income and the income from profession together and deduct TDS u/s 192 on the entire amount.