When an individual is simultaneously working as an employee in 2 different companies (one pvt ltd co and one proprietorship company) and drawing salary from both of them , then how should I compute the TDS to be deducted from his monthly salary ?
2 Replies
Naga Upendra
(159 Points)
Replied 13 December 2021
If the employee provided details to the employee regarding the other income (any including the partnership salary income), after considering the same TDS has to deduct.
debora M
(BUSINESS DEVELOPMENT MANAGER)
(1697 Points)
Replied 13 December 2021
As per Section 192 of the Income Tax Act, 1961, TDS is deductible on salary income. Depending on your net taxable salary, the TDS is deducted by the employer on your behalf and deposited to the income tax department. The TDS deducted by the employer is reflected on Form 16 issued annually. You can, then, calculate your tax liability at the end of the financial year and then adjust the TDS to pay either the differential liability or to claim a tax refund.
TDS is deducted from the salary when the amount is actually paid. It is not deducted when your salary accrues, i.e. when you are earning the salary but it is not being paid by the employer. Moreover, if you receive an advance on your salary or if your employer pays the outstanding salary in one lump sum, TDS would be deducted on such payments.
If, however, your taxable salary is below the threshold limit of tax, TDS would not be deducted from the salary income. The threshold limit for the current financial year, i.e. FY 2021-22 is as follows –
- Individual taxpayers and HUFs below 60 years of age – INR 2.5 lakhs
- Senior citizens aged between 60 and 79 years – INR 3 lakhs
- Super senior citizens aged 80 years and above – INR 5 lakhs
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