Deceased

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Bapun Dasgupta (Querist)
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02 June 2021 Mr. X has recently died of Corona while still in service. He was an employee of an organisation which is covered by the Payment of Gratuity Act. His taxable gratuity , after considering exemptions u/s. 10(10)(ii) is, say, Rs. 1,00,000/-.

How will T.D.S. be calculated on the above taxable gratuity of Rs. 1,00,000/- while making the payment to the legal heirs of Mr. X and what will be the T.D.S. amount ?

Thanks and regards.

Ganeshbabu K

Ganeshbabu K (Expert)
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02 June 2021 IF TDS DEDUCTED IF ANY YOU NEED TO DEDUCT UNDER EMPLOYEE PAN only.

The CBDT Notification no. S.O. 1213(E), dated 8 March 2019, clarified that the exemption limit of Rs 20 lakh would be applicable to employees in the event of retirement or death or resignation or disablement on or after 29 March 2018.

Bapun Dasgupta

Bapun Dasgupta (Querist)
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02 June 2021 That is fine Sir, but I want to know how much TDS will be deducted from his taxable amount of gratuity on his final settlement.

Thank you and regards, Sir.

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CMA Poornima Madhava

CMA Poornima Madhava (Expert)
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02 June 2021 Gratuity which is due as well as paid after the death of employee, to family members is not taxable I think. But if gratuity was due during the lifetime of the employee but paid after death, then taxable in the hands of the deceased person. Tax in this case is computed according the slab rate.

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Bapun Dasgupta

Bapun Dasgupta (Querist)
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02 June 2021 Thank you very much Madam...this is exactly what I wanted to know.
Regards.