TDS

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

23 July 2010 After working for around 2.6 years in a company i join another company to which as per previous company policy i have pay him around Rs50000 in lie of my exp & relieving letter. I paid such amount from my pocket . My new company ready to pay this amount back to me but they are deducting income tax amount from this as my new company considers this as my income. I don't understand why they are considering this as my income while giving back my money to me. There are considering this amount as my bonus while giving back to me so it comes under my salary structure. My question is how & why my current company pay on the behalf of my previous company. Why should i repay income tax as the money from which i had purchased my relieving & exp. letter has come in my pocket only after deducting all the taxes? Lastly, my new company accountant want to explain that this deduction is as per u/s 92b & 192b.I'm not sure about these clauses so want to share this also. Desperately waiting for your reply

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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23 July 2010 Your employer is correct, while reliving from the previous employer your own obiligation to pay Rs.50000, in this your present employer no relevance but they are compensating your loss of Rs.50000 paid by you to your previous employer, so it is your income only, Income tax attract and TDS applicable