PANKAJ SHARMA (Accounts Executive) (200 Points)
02 May 2013pls guide me, as to How Rebate of Rs.2000/- u/s 87A proposed in budget will be allowed:-
1) shall i don,t deduct TDS, in case employee income is below Rs.500000.
2) Shall TDS will be deducted as usual, and rebate will be allowed at the time of filing of ITR.
PMA Nooruddin
(M.Com, Finance Manager)
(422 Points)
Replied 02 May 2013
You have both answer and solution in your query,
Lest,
Deduct tds as per provisions the deductee will get rebtate his refund if is under the income bracket of Rs.200000- to Rs.500000-
and this is applicable for Assessment Year 2014-15
PANKAJ SHARMA
(Accounts Executive)
(200 Points)
Replied 02 May 2013
but incase total Tax of an employee comes out to be Rs.1800/- or so, then taking into consideration Rs.2000/- rebate, we are not required to deduct TDS??????
PANKAJ SHARMA
(Accounts Executive)
(200 Points)
Replied 02 May 2013
& for A.Y. 2014-15, we have to Consider this rebate in April 2013 Salary also?????
PMA Nooruddin
(M.Com, Finance Manager)
(422 Points)
Replied 02 May 2013
Applies for the period from April 2013 to March 2014 (AY 2014-2015)
and irrespective of tax coming to Rs.1800- or rebate Rs.2000- who have to deduct tax if he is elibigle,
his tax credit should be more than 2000 if wants to avail this rebate,
In Simple words this rebate is availble to those who have paid tax more than 2000
Sujata
(CA Final)
(26 Points)
Replied 08 May 2013
After taking benefit of rebate (Rs.2,000.00), deduct TDS on Salary.
So basically you have to consider rebate before deducting TDS.
First you have to calculate total tax liability(excludinng e cess) , then reduce Rs.2,000.00 .Now add e cess on the resulting figure and then deuct TDS on Salary. You can also verify the same from tax calculator on income tax website.
PMA Nooruddin
(M.Com, Finance Manager)
(422 Points)
Replied 08 May 2013
@ Sujata
I Dont think that you have to consider this rebate for calculations, The terms rebate itself denotes that if you had crossed Rs.2 Lakh slab and Tax is deducted which is more that 2000 then only the Assesing Officer which Credit this rebate in your Returns...
this is finance bill language in this regard
"87A. An assessee, being an individual resident in India, whose total income does not exceed
five hundred thousand rupees, shall be entitled to a deduction, from the amount of income-tax (as
computed before allowing the deductions under this Chapter) on his total income with which he is
chargeable for any assessment year, of an amount equal to hundred per cent. of such income-tax or
an amount of two thousand rupees, whichever is less.”.
In my opinion.
The language suggests that it is a deduction from Income tax payable, so if liability of a person is up to Rs 2000, he is not liable to any tax in the credit of goverment.
Neha Sharma
(AGM-F&A)
(21 Points)
Replied 05 July 2013
That means if the TDS of an employee comes to Rs. 5400, then rebate of Rs. 2000 will be given and his final TDS will be Rs. 3400
or TDS wil be 5400, but rebate of 2000 will be claimed while filling return?
CAclubindia
