Blog > Tax Deducted At Source (TDS) Under Section 192

Tax Deducted At Source (TDS) Under Section 192

by Varun Advani | 27 June 2015

WHEN AND HOW TAX IS BE DEDUCTED AT SOURCE FROM SALARY [SEC.192]

The summarized provisions of section 192 are given below:

 

Who is the payer

Employer

Who is the recipient

 

Employee

Payment covered

Taxable salary of the employee

At what time tax has to be deducted at source

At the time of payment

Maximum amount which can be paid without tax deduction

INR 2,50,000

Rate of tax deduction at source

Tax is to be deducted at source according to the tax slabs.

Is it possible to get the payment without tax deduction or with lower tax deduction

The employee can make an application in Form No.13 to the Assessing Officer to get a certificate of lower tax deduction or no tax deduction.

                                                                                                                                                                                                     

The employer may, at the time of deduction tax at source, increase or decrease the amount to be deducted for the purpose of adjusting any previous deficiency or excess deduction.  

 

The employer must keep the following points in consideration while deducting TDS for assessment year 2015-16: -

 

House rent allowance exemption –Exemption pertaining to house rent allowance shall be calculate by the employer on the basis of specified limit provided by section 10 (13A). This exemption depends upon rent paid by employee .The concerned employee should submit to the employer a written statement pinpointing rent paid, name of landlord, address of the property and PAN of landlord (PAN is required only if rent paid is more than Rs.1,00,000 per annum)along with rent receipt given by the landlord.However, for the purpose of tax deduction ,the Center Board of Direct Taxes has given a concession that rent receipt is not required if house rent allowance is Rs.3,000 per month or less.

 

Other incomes of employee –An employee (at his option) can declare his other incomes to the employer. He cannot declare negative incomes (except house property loss).

 

Employer should take into consideration amount deductible under sections 80CC,80CCC,80CCG,80D,80DD,80DDB,80E,80EE,80GG,80GGA,80TTAand 80U.

 

Tax liability –Tax is deductible on the taxable income at the rates applicable for the financial year.If the employee does not have PAN, tax is deductible either at the normal rate or at the rate of 20 per cent, whichever is higher. Tax is not deductible, if estimated salary of an employee does not exceed exemption limit (this rule is applicable even if the employee does not have PAN).At the request of an employee, the employer can give relief under section 89. However, this facility is available only if the employer is Government or public sector undertaking or company, co-operative society, local authority, university, institution or association or body.

 

When an employee and more than one employer during the financial year, each employer will deduct taxseparately. However, the employee is under obligation to declare salary received (and tax deducted thereon) from other employers to one of the employers by submitting information in Form No.12B. The employer to whom Form No.12B is submitted shall deduct tax on the basis of aggregate salary.

TDS certificate will be given to the employee in Form No.16 annually on or before May31 after the end of the financial year. This certificate has to be given in paper format. However, if few conditions are satisfied Form No. 16 can be given with digital signature .The employer should also give a statement of perquisites/profits in lieu of salary in Form No.12BA (if salary exceeds Rs. 1,50,000).

Salary without TDS or with TDS-To get salary without TDS or with lower TDS, the employee will have to approach the Assessing Officer by submitting an application in Form No.13 under 197.

Efiling of Income Tax