Struggling with Overtime and TDS Calculations? Need Your Guidance!

Hello Seniors,

Please advise me on how to calculate overtime and TDS. I came across some calculations but failed to understand.

Regards,
Ritika

Dear Atul,

For the calculation of overtime (OT), it is calculated as follows:
= (Basic or Gross salary) / 26
This will give you the per day amount,
= per day amount / 8, which will provide you with the per hour amount.

Regards,
Atul

Dear Ritika,

Kindly note that all the amounts paid by the employer to the employee (other than reimbursements) fall under the head Salary Payments, and obviously, the Overtime is also taxable as per Salary Rules.

i.e. you will have to add the overtime payment to the Salary Component only.