Handling Salary Tax and TDS for Senior Employees: What Are Our Responsibilities?

We hired some senior employees, and their salary falls under taxable income. I would like to know, is it necessary for our organization to handle their salary tax and file TDS? When preparing the salary slip, do I need to show their deductions?

Hi, it is mandatory by law to deduct all the taxes and deductions as per various laws and mention the same in the salary slip.

Regards,
Sushil.

The company is liable to deduct tax at the source; hence, it has to complete the other formalities.

Thank you for the reply. Is there a formula to deduct tax? For example, if I am providing a CTC of 8 lakh per annum to an employee, how and on what basis can I deduct their tax?

Another Question

Do I need to show the tax deduction in the employee's salary slip?

Thank you,

Munali

Dear Sir, please help me with how to set the salary structure to deduct less TDS from salary. How to deduct TDS from salary? What is the formula to deduct TDS from salary?

Regards, Vedvert Dalal (Executive HR)

I have attached the TDS calculation sheet for your reference.

Regards.

I think you should go through the Income Tax Ready Reckoner. It can help solve your income tax on salary problem.

Regards,
Kamlesh Mehta

Dear Laxmansingh, presuming that your gross monthly salary is ₹15,000/-, please find enclosed a salary structure with tax computations.

Regards

The employer PF will be shown on CTC and not on Gross Salary. You may like to correct the same. Furthermore, the short forms like MR, etc., may be given the full expanded version so that everyone can understand.

Regards

Thank you for the inputs. You are correct that the employer's contribution to PF is never shown as part of the gross salary, although it is part of the CTC. I will correct that. Yes, abbreviations should have been avoided for better understanding. I appreciate your feedback.

Regards,
Rajiv

Understanding TDS: Income Tax Deducted at Source

TDS means "Income Tax" deducted at the source. Fundamentally, it is nothing but Income Tax only. The difference necessary for understanding is that through TDS provisions, the government has ensured the early recovery of Income Tax as it is deducted by the employer while making salary payments and deposited with the government treasury. The employee, while filing ITR, claims the TDS to be set off against his/her Income Tax Liability.

Regards,
Rajiv