TDS on Salary is optional ????

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Vijay Parmar (Querist)
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30 December 2010 hello

i have read that tds on salary is optional even if out establishment is company or firm... (section 195, 206(c))

plz clarify

and help me

its optional ?? any penalty / disallowance apply ???

CA. Anuj Gupta

CA. Anuj Gupta (Expert)
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31 December 2010 The question is not clear, if I am able to understand correctly then you are asking about tax liability of a foreign company having its employees in India.

Vijay Parmar

Vijay Parmar (Querist)
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31 December 2010 the question is ...

one of the firm having 12 employee ....

salary of all employee is maximum basic exemption limit of income tax..

employee 1 : salary 4 lac
employee 2 : salary 6 lac and etc...

then employer is liable to deduct tds from its employee salary ??

if employer not deduct any tds from salary then any penalty apply???

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Balakrishnan

Balakrishnan (Expert)
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31 December 2010 The employer should deduct TDS.

If not the entire salary exp. will be disallowed.

You will attract penalty as well as prosecution also.