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Query On : TDS Its Urgent - Please Help

CA Hardik Vyas (Practicing Chartered Accountant) (130 Points)

18 September 2010

MY CLIENT IS GOVT. EMPLOYEE.

HE WANT THAT HIS TDS OF ENTIRE YEAR MAY BE DEDUCTED AT THE 1ST QTR.

BUT HIS EMPLOYER DENIED TO DO SO.

CAN HE FORCE HIS EMPLOYER BY MAKING AN APPLICATION INDICATING INCOME TAX RULE / SECTION TO DO SO?

PLEASE QUOTE THE SECTION UNDER WHICH HE CAN MAKE AN APPLICATION?

AND CAN HE MAKE ADVANCE PAYMENT OF TAX TO RELIEVE FROM TDS?

PLEASE HELP ME ON THIS..

THANKS................... IN ADVANCE..

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3 Replies

CA Trinath Galla (student) (3130 Points)
Replied 18 September 2010

i think its not employer's obligation to do so.

income tax provisions say to deduct the entire amount of tax over the period of f.y.

no where it is said that there is an option to the employee to direct the employer to deduct tds as per the directions issued by him.

however if employer accepts to deduct entire tds in 1st quarter, he can do so, but there is no such compulsion.and advance payment of tax can not be adjusted in tds.

............lets wait for experts reply

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A. RAVINDRE (CONSULTANT) (25 Points)
Replied 23 December 2010

Originally posted by : Hardik Vyas
	MY CLIENT IS GOVT. EMPLOYEE. HE WANT THAT HIS TDS OF ENTIRE YEAR MAY BE DEDUCTED AT THE 1ST QTR. BUT HIS EMPLOYER DENIED TO DO SO. CAN HE FORCE HIS EMPLOYER BY MAKING AN APPLICATION INDICATING INCOME TAX RULE / SECTION TO DO SO? PLEASE QUOTE THE SECTION UNDER WHICH HE CAN MAKE AN APPLICATION? AND CAN HE MAKE ADVANCE PAYMENT OF TAX TO RELIEVE FROM TDS? PLEASE HELP ME ON THIS.. THANKS................... IN ADVANCE..

A. RAVINDRE (CONSULTANT) (25 Points)
Replied 24 December 2010

TDS has to be deducted in line with advance tax. There is nothing wrong in deducting the entire tax amount computed in advance. In fact it would be convenient for your client's employer.

Filing of etds return also does not pose any problem at all. For eg: let us say salary for the 1st quarter is 75000/- (April to June) and say tax liability for the entire financial year is Rs. 12500/-. Employer can deduct the tax in any month during the 1st quarter or spreading 12500/- over 3 months of the said quarter.

If the entire tax amount of Rs. 12500/- is deducted in June, then while filing his ETDS return for the 1st quarter he has to prepare the data in following manner:

In deduction sheet of 24q1 (ETDS return) he has to enter Rs. 25000/- in the amount paid column,

Mention Tax deduction date as 30-06-year,

Enter tax paid column with 12500/- ,

total value of concerned challan in challan shet and

link the same to deduction sheet entry mentioned above.

He need not show any deduction details for the said employee in the remaining three quarters (q2 q3 q4).

In q4 returns, only he has to show the details of form 16 in salary sheet provided in q4 returns.

The above procedure is quite acceptable and valid. In fact IT department will be happy if such methodology is adopted. He will get the full credit in his 26AS as single line entry.

It reduces employer's work also.

If employer does not agree for the deduction, alternatively, your client can compute the tax and pay in advance using advance tax challan ITNS-282 to the designated banks quoting his PAN number.

Regards

Ravindra