Should we deduct TDS on when salary is credited or when it is actually paid?
28 Replies
Sripada M
(CA)
(365 Points)
Replied 18 September 2009
TDS on salary should be deducted either on accrual basis or payment basis whichever is earlier.
CA. ANKUR JAIN
(CA.....)
(2800 Points)
Replied 18 September 2009
YOU SHOULD DEDUCT TDS FROM SALARY ON paymnt (ACCRUAL) BASIS
Sripada M
(CA)
(365 Points)
Replied 18 September 2009
Hi Ankur,
As per my knowledge, it is accrual or payment which ever is earlier.
If it is on accrual basis, then what about Advance salary???
swohra
(none)
(537 Points)
Replied 18 September 2009
Dear Ajeet
In the case of "Salaries" the liability to deduct tax arises only at the time of payment.
CA Sumit Arora
(CA)
(1411 Points)
Replied 18 September 2009
TDS should be deducted at the time of Payment.
shilpi jain
(Chartered Accountant)
(69 Points)
Replied 18 September 2009
yes, as per sec 192, TDS on salary should be deducted at the time of payment.
shilpi jain
(Chartered Accountant)
(69 Points)
Replied 18 September 2009
yes, as per sec 192, TDS on salary should be deducted at the time of payment.
Rajeev
(EO)
(54 Points)
Replied 18 September 2009
If I pay 3 months salary together to my employee on say 10th of september and deposit TDS so deducted by 5th of Oct, would I be committing a mistake since the salary had accrued in earlier months and I was carrying it as payable in my accounts..???
Sunil Liladhar Kotak
(Manager (F & A))
(2025 Points)
Replied 18 September 2009
Hi Rajiv, You will not be committing any mistake.
Pawan Kumar
(audit manager)
(118 Points)
Replied 18 September 2009
hello rajiv
According to Sec192 TDS on salary shall be deducted only at time of payment of salary. Therefore you will not be committing any mistake.
Sunil
(Trader)
(2611 Points)
Replied 18 September 2009
On accrual or payment whichever earlier. So if you paid March Salary in April it is still taxable in March. The other way round, if you paid 12 months salary before March and also gave an advance in March that is adjusted against April Salary, then the advance paid in March will also be taxed in March. That is the meaning of on due basis or payment, whichever earlier.
Amit Mukim
(Article)
(40 Points)
Replied 18 September 2009
Hi Rajeev,
TDS should be deducted at the time of Credit or payment, whichever is earlier & in ur case TDS should be deducted when you have credited employee for Salary.
Credit also includes making provision for the expense, so you should deduct TDS at the time of booking expense, so u have made late deduction of TDS
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