Hi Friends
Can any one tell me about tds on salary?????
one of my client is getting part time salary from a proprietorship firm. they are paying rs. 8000 by cheque and 12000 in cash. my client is having rs. 70000 as investment in previous year and will be in current year also. i am saying to him to get salary aroun rs. 14000by cheque but chartered accountant of proprietorship firm is saying to deduct tds. on whole the amount without deducting savings amount.
whether it is right policy or no.
if a person having rs. 70000 as investment and having rs. 162000 total income why tds should be deducted???
Can anyone solve this problem.
3 Replies
Bharat
(CA Job)
(20 Points)
Replied 10 May 2007
Dear Sir
Though the above persons income is below taxable limit but as per section 192 of the act if the person has not furnished the declaration of investment in the way of undertaking then the employer is required to deduct tax at avearege rates(Maximum Marginal rates).If he produces the same then No tds.
Bharat-A member of ICAI
[quote=GAURAV RUSTAGI (Guest)]Hi Friends
Can any one tell me about tds on salary?????
one of my client is getting part time salary from a proprietorship firm. they are paying rs. 8000 by cheque and 12000 in cash. my client is having rs. 70000 as investment in previous year and will be in current year also. i am saying to him to get salary aroun rs. 14000by cheque but chartered accountant of proprietorship firm is saying to deduct tds. on whole the amount without deducting savings amount.
whether it is right policy or no.
if a person having rs. 70000 as investment and having rs. 162000 total income why tds should be deducted???
Can anyone solve this problem.
[/quote]
Vk Duggal
(320 Points)
Replied 10 May 2007
As you are syaing that salary of Rs. 8,000 p.m. is by cheque and rest by cash. First thing to clarify is whether Rs.12,000 p.m. paid in cash is being shown by the employer as salary or not. If yes, the total salary will be Rs. 240,000 (20,000 X 12).
On this TDS is applicable. If employee does not give the evidence for the investment/ deductions, employer is bound to deduct TDS.
On this TDS is applicable. If employee does not give the evidence for the investment/ deductions, employer is bound to deduct TDS.
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