Confused About TDS Deduction from CTC? Let's Break Down This Calculation Together

Dear All,

Is this calculation correct? How do we deduct TDS from CTC?

For example:
CTC - 3,90,000 // We subtract 275,000 = 115,000. For 115,000 at 5%, which is 5750. Subtracting 5750 from 390,000, we get 384,250. By dividing 384,250 by 12, we get 32,020. Does 32,320 represent the take-home pay of an employee?

Slab:
0 to 2.75 lac - nil
2.75 to 5 lac - 5%
5 to 10 lac - 10%
Above 10 lac - 20%

Please clarify.

Thanks,
Keerthi

Dear Members,

Shouldn't TDS be done on the gross amount rather than the CTC? CTC includes many components that are non-taxable for the employee.

Please advise.

Hi Dinesh,

What are the saving components? I asked HR what are the deductions in CTC. He said only TDS. They fixed 32,500 as the monthly CTC, and my take-home is 32,000, i.e., 32,000 is take-home, and 2,500 Rs is TDS. By the above slab, is it right?

Regards,
Keerthi

Dear Keerthi, the employer can only deduct TDS if the employee fails to submit their investment declaration. They cannot deduct a fixed amount from the salary without considering the investment declaration. You can ask the employer for the salary structure to understand the exact salary and deduction components. Providing your investment declaration can help you get an exemption from the tax slab. The investment declaration can include details about your LIC or other tax-saving policies, mediclaim, conveyance, interest on a home loan or rent paid, etc.

Regards, Manish