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TDS on Salary – Sec 192

Introduction to TDS 192
Per TDS-192, TDS is detected from employee by employer from their salary. Based on the Salary Range the employee receives the TDS is made Applicable. The typical percentage of deduction ranges somewhere between 10%-30%.

TDS Deduction
TDS deduction is made on salary only when actual payment is done. TDS will be deducted when the employee’s salaried income is falling under the taxable slab. If the Basic gross in the salary of an employee is equal to or less than Rs.2,50,000 and the age of an employee is below 60, then TDS on salary will not be deducted. If the Basic gross in the salary of an employee is equal to or less than Rs.3,00,000 and the age of an employee is above 60 and below 80, then TDS on salary will not be deducted. If the Basic gross in the salary of an employee is equal to or less than Rs.5,00,000 and the age of an employee is above 80 and then TDS on salary will not be deducted.

According to section 192 of TDS, When there is an Employee-Employer relationship.TDS is deducted to an employee working in the following Industries:
Companies (Private or Public)
Partnership firms
Co-operative Societies

Tax Deduction
TDS does not mention a particular tax rate to be deducted. Based on the salary received by an employee, and based on the deductions the tax is calculated based on the slab in which the employee falls under. The employer calculates the taxes mostly by the beginning of the financial year.
The TDS is calculated by the employer to employee as follows
TDS=Estimated Tax (Year)/Number of months employed in the current organization.
It is mandatory that the employer withhold a Pan-Card.In the case of the absence of PAN, 20% of TDS is deducted.

Any Excess or deficit arising is adjusted by in subsequent deductions during the same financial year. If any Payment is done in advance, then the same can be adjusted for the calculation of TDS.

If a person is engaged with multiple organizations at the same time, then the Information can be provided in Form 12- TDS in Form 12B to any one of the employers. This will help to deduct the TDS Accordingly. In case of change of employment from one organization to the other, the details of previous employment are mentioned in Form 12B to the new employer. Based on the details mentioned, TDS will be deducted for the remaining months of that particular financial year.

Form 16 & 12BA
The employer will provide Form 16 to employee which will have the details of salary. This includes the amount paid and also the tax deducted. Along with FORM-16.This can also Form 12BA Is also added. Form 12-BA will help to show particulars of perquisites, and profits in lieu of salary.

TAX Deposition under Section 192

If the government employer deducts the TDS, it has to be deposited on the same day.
If the TDS is deducted by an employer who is not under Government organization. The salary is credited and TDS will be deducted in the month of March before 30th or If the salary is credited and TDS is deducted in any month other than March it is deposited Within seven days from the end of the month in which the deduction is made.

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