Tds on retention amount deducted from employee salary

TDS 841 views 2 replies

We are engaging technical employees and --

1) deducting some amount say 5-10% of their monthly salary  as Retention. On leaving the after 3 years we are returning to them. Whether TDS to be deducted on Gross salary to them with considering Retention amount ?

2) If employee leaves organisation before commitment period and Company forfeit his Retention amount, then what about TDS if already deducted. Employee says, I left the Company and you forfeited my Retention amount due breach of commitment period. You should not deduct TDS on that amount.

Please advice

 

Replies (2)

1. TDS can be deducted on the gross salary including the retention amount

2. Any such unforeseen situation arises, TDS remitted can be claimed as a refund. 

1-Yes
2- It can be claimed as refund becoz it will reflected in ur 26 AS....


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