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calculation of TDS on salary for the A.Y. 2010-11

Abhay (1) (123 Points)

04 November 2009

plz tell me hoe to calculate tds on Salary Plz give Example...or solve my eg.

per month details

Basic 70000

HRA 21000

Conveyance 7000

bonus for the year 09-10 will be 70000

PF deduction 780 & Professional Tax deduction Per month is 200.

Plz tell me how to solve this?

Thank U.

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14 Replies

CA Mani (Credit Analyst) (2814 Points)
Replied 04 November 2009

Basic- Fully taxable

HRA- Fully Taxable( Provided any rent is not paid)

Conveyance- 6200( Assuming It is transport allowance)

Bonus Fully taxanble

Deduct any investment made as per 80C

Add above and apply tax slab rates

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BHAGYESH RAVANGE (C.A Job) (1528 Points)
Replied 04 November 2009

T.D.S on salary is deducted on the assumption basis.While making the payment of Salary, deductor should consider the following and deduct correct TDS from the payment being made.

Calculate the annual Approximate/Actual Salary
1. Calculate the Exact Taxable Salary amount Paid/Payable till current month for the financial year.
2. Calculate the approximate salary that will be paid for rest of the FY, assuming the current month salary for rest of the year salary.
Add any other income reported by the Assessee [Employee].
Deduct if any Loss declared by the Employee, from the annual taxable salary. Note that, only House property loss (interest in case of Self Occupied House Property) should be considered.
Deduct the allowed deductions declared by employee under Section 80C, 80D, 80G, etc.
Calculate the Income Tax, Surcharge and cess on the net Income, as per the “Rates in Force”
Deduct if any rebate U/s 88E or Relief U/s 89. (explain the heads)
Keeping it as total tax, now deduct the TDS made till last month from it.
Divide the net TDS by “Remaining number of months in the FY, including current month”.
Deduct this amount from employees Salary

CA Trinath Galla (student) (3130 Points)
Replied 04 November 2009

Basic-fully taxable

HRA-fully taxable if no rent is paid

Conveyance- if it is transport allowance, Rs.800 per month is exempt. If it is for conveyance actaul expenditure is exempt.

Bonus fully taxable.

Calculate GTI per anum

total tax/12 is tds to be deducted every month

BHAGYESH RAVANGE (C.A Job) (1528 Points)
Replied 04 November 2009

The above example is for which A.Y

1 Like

CA Trinath Galla (student) (3130 Points)
Replied 04 November 2009

u can apply it for any A.Y as tax rates are not yet applied for that example

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CA Devanshi Gandhi (Ajani) (FCA DISA Mcom CIFRS & LLB) (9058 Points)
Replied 04 November 2009

agree with the above answers

Gaurav Raichura (CA-Final Student) (82 Points)
Replied 04 November 2009

Taxable Income:

(A) Basic = 70000*12

(B) HRA = 21000*12 (if he/she is living in his own house & not in rented house)

(B) HRA = if lives in rented house and pays rent, then least of the following * 12 months

252000 OR 40% of Salary OR Actual Rent paid - 10% of Salary

252000 OR 50% of Salary OR Actual Rent paid - 10% of Salary

(Here Salary = Basic + DA if considered for retirement benifits + % based comm. on turnover)

(C) Conveyance = 6200 * 12 (if transport allowance) otherwise 7000*12

(D) Bonus = 70000

(E) Total (A) to (D) LESS (i) P.T. = 200*12

The (E) will be Gross Total Income provided the employee has not reported to employer any other income or loss from house property.

(F) Net Taxable Income = Gross Total Income LESS (i) PF = 780*12 (ii) allowable deduction under chapter VI-A, if any

(G) On (F), apply the slab rate whichever is applicable to the assessee and find the tax.

(H) Thereafter, what-so-ever figure comes under (G), divide it by 12 months and the resulting figure will be the amt. of TDS per month from the salary of the said assessee.

Deepika (nil) (84 Points)
Replied 05 November 2009

Agreed with above answer

CA Sidhi Gaur (Chartered Accountant) (247 Points)
Replied 05 November 2009

yes, i agee..

ANITA KAPOOR (MANAGER - ACCOUNTS) (22 Points)
Replied 05 November 2009

pls. forward annual return form in excel format at my email id thks

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RAMANA M V (Manager - F&A) (27 Points)
Replied 06 November 2009

Originally posted by :Gaurav Raichura
"	Taxable Income: (A) Basic = 7000012 (B) HRA = 2100012 (if he/she is living in his own house & not in rented house) OR (B) HRA = if lives in rented house and pays rent, then least of the following * 12 months 252000 OR 40% of Salary OR Actual Rent paid - 10% of Salary 252000 OR 50% of Salary OR Actual Rent paid - 10% of Salary (Here Salary = Basic + DA if considered for retirement benifits + % based comm. on turnover) (C) Conveyance = 6200 * 12 (if transport allowance) otherwise 700012 (D) Bonus = 70000 (E) Total (A) to (D) LESS (i) P.T. = 20012 The (E) will be Gross Total Income provided the employee has not reported to employer any other income or loss from house property. (F) Net Taxable Income = Gross Total Income LESS (i) PF = 780*12 (ii) allowable deduction under chapter VI-A, if any (G) On (F), apply the slab rate whichever is applicable to the assessee and find the tax. (H) Thereafter, what-so-ever figure comes under (G), divide it by 12 months and the resulting figure will be the amt. of TDS per month from the salary of the said assessee.	"

thanks

CA Ghanshyam Joshi (CA, Dip IFR (ACCA UK)) (3229 Points)
Replied 08 November 2009

Please check this excel file. This will be helpful for you. It is free download.

Attached File : 58 taxcalc 2010.zip downloaded: 380 times

CA ESHAN CHAKRAWARTI (job) (101 Points)
Replied 20 December 2010

if assesse is having GTI of 500000 & have contributed 50000 in LIC & is supposed to contribute 50000 more in the LIC in the next month then for deducting tds of this month whether to consider deduction of only 50000 or 100000?