CA. Mnaish Dafria, Indore. T.D.S. from Salary By CA. Manish Dafria Member, Regional Direct Tax Advisory Committee Indore

CA. Mnaish Dafria, Indore. TDS From Salary : Basic Provisions Time of TDS At the time of payment of salary. Time of deposit of TDS In case of Government Organisation – Same day Other cases - 1 week from the end of the month in which deduction has been made

CA. Mnaish Dafria, Indore. TDS From Salary : Basic Provisions Certificate of TDS In Form no. 16. Where the Gross Salary is upto Rs. 1,50,000, certificate is in Form no. 16AA. In case of salary above Rs. 1,50,000, a statement in Form 12BA, stating the nature and value of perquisites is also required to be provided. In other cases, the information would have to be provided by the employer in the Form 16, 16AA itself.

CA. Mnaish Dafria, Indore. TDS From Salary : Basic Provisions Time limit for issue of TDS Certificates By 30 th April of next year. Delay in issue of Certificates A penalty of Rs. 100 per day per certificate, subject to maximum upto the amount of tax deducted, is payable in case of delay in furnishing TDS certificate. If you have 20 employees and there is delay of one week in furnishing the TDS certificate.... …

CA. Mnaish Dafria, Indore. TDS From Salary : Calculation Methodology Work out the anticipated salary of each employee on the basis of previous year’s salary in the beginning of the year. Work out the tax to be deducted at source on the anticipated salary at the prescribed rates after considering anticipated deductions and divide the same by 12.

CA. Mnaish Dafria, Indore. TDS From Salary : Calculation Methodology Deduct 1/12 of the tax in every month from the 1st month of the financial year i.e. April. Increase the amount of monthly TDS from the month in which any unforeseen increase is made to the salary of any employee on account of any Bonus, Arrears of Salary, Dearness Allowance, etc. which could not be foreseen in the beginning of the year.

CA. Mnaish Dafria, Indore. TDS from Arrears Any arrear paid for earlier years are also required to be added in the current year salary for calculation of tax purpose. However employee may spread over this arrear to earlier years and claim a relief u/s. 89. Employee has to submit the calculation of this in form no. 10E and then only DDO can grant this relief.

CA. Mnaish Dafria, Indore. TDS from Other Payments If any other remuneration/honorarium etc. is being paid to employees, it is also to be added to Salary and TDS be made accordingly. However, any award/reward by Central or State Government for approved purposes are exempt from tax and accordingly no TDS be made from the same.

CA. Mnaish Dafria, Indore. Salary : Deduction Available Following important deductions are available: L.I.C. Premium P.F. Contribution N.S.C. Tuition fees for max. 2 children 5 years deposit in Bank/Post Office Repayment of Housing Loan All these are allowed as deduction subject to Max. Rs. 1,00,000

CA. Mnaish Dafria, Indore. Salary : Deduction Available Following other deductions are also available: Infrastructure Bonds (Rs ) Mediclaim Premium (Rs ) Exp. On handicapped dependent relative (Rs /100000) Exp. On treatment of specified disease(Rs ) Repayment of Higher Education Loan Donations to National Importance Funds

CA. Mnaish Dafria, Indore. Salary : House Loan Interest Max. deduction is Rs. 1,50,000. However if loan has been taken for repairing of house, the deduction is max. Rs House should be in the name of employee. If H.R.A. exemption is being claimed, then housing loan interest is not deductible

CA. Mnaish Dafria, Indore. Salary : Important Issues There is no obligation to issue the TDS certificate (Form 16) in case tax at source is not deductible/not deducted by virtue of claims of exemptions and deductions.

TDS RETURN

Do U Have A Problem with TDS ???? Are You facing problems with Income Tax Notices ? Has Tax department issued a demand on you for recovery of tax, interest, penalty etc.? Have your employees been demanded tax by Income Tax Department though you have deducted tax from their salary ? If Yes, next slides are very important for you.

TDS Return Filing TDS return are to be filed quarterly. Due Dates for filling TDS returns are: Quarter Govt. Non Govt. Q1 July 30 July 15 Q2 Oct 30 Oct 15 Q3 Jan 30 Jan 15 Q4 May 30 May 15

Penalty for delay in filing return If there is delay in filling return till due date, penalty of a sum of one hundred rupees for every day during which the failure continues.

Details to be provided in Return In every quarter: Details of the salary paid Amount of tax deducted Correct PAN of employee

Details to be provided in Return In last quarter: Complete details of annual salary is to be given as follows :- 1. PAN, Name and Gender of the employee 2. Total amount of salary. 3. Professional tax. 4. Income under any other head (House Loan Interest etc.) 5. Amount deductible under chapter VI A. 6. Income tax on total income. 7. Total amount of TDS for the whole year. 8. Shortfall in tax deduction/Excess tax deduction.

Points to be kept in mind while preparing TDS Return PPAN of deductee should be mentioned correctly.

 Date of deduction and date of deposit should be same(in case of govt. deductors).

Points to be kept in mind while preparing TDS Return  Treasury voucher no./BIN should be mentioned.

Points to be kept in mind while preparing TDS Return  Gender must be mentioned correctly and TDS should have been deducted as per the applicable slab.

Points to be kept in mind while preparing TDS Return  Total tax of employee should be deducted by way of TDS and not paid through his PAN.

About Form 24G District Treasury Officers (DTO) are required to file Form 24G every month. This form contains details of all TDS collected by them and transferred to Govt. account in respect of all DDOs associated with them.

AIN For filing Form 24G, it is mandatory for each DTO to have an Accounts Office Identification Number (AIN). AIN is a unique seven digit number which shall be allotted by the Directorate of Income Tax (Systems), Delhi, to every DTO.

Contents of Form 24G The contents of Form 24G should be as follows: Details of the DTO filing Form 24G (AIN, name, demographic information, contact details). Statement details (month and year). Payment summary; nature of deduction wise (TDS – Salary /TDS Non-salary ). DDO wise payment details (TAN of DDO, total tax deducted and remitted to the Government account

Application for AIN Application for AIN has to be made in the form ‘Application for allotment of Accounts Office Identification Number’ (AIN application form). The application has to be made in physical form as per guidelines provided with the AIN application form.

Application form for AIN The application form can be downloaded from the Income Tax Department website or the TIN website or from the office of the Income Tax Department. The duly filled and signed application for AIN allotment is to be submitted in physical form to the jurisdictional CIT (TDS).

Allotment of AIN Complete and correct AIN application forms submitted by the PAO / CDDO / DTO will be forwarded to NSDL by the CIT (TDS) recommending allotment of AIN to the PAO / CDDO / DTO. AIN allotment letter will be sent to the PAO / CDDO / DTO at the address mentioned in the AIN allotment form.

Thanks to all !!!!

CA. Mnaish Dafria, Indore.

T.D.S. from Interest

CA. Mnaish Dafria, Indore. Interest : Sec. 193 & 194A. Nature of Payment Payment to a resident of Interest Time of Deduction At the time of credit of income to the payee's account or at the time of payment, whichever is earlier Rates of TDS Non corporate 10%+ Surcharge+Cess Domestic Company 20%+ Surcharge+Cess

CA. Mnaish Dafria, Indore. Interest : Important Exemptions No tax is to be deducted from-- Any interest payable on any security issued by a company, where such security is in dematerialised form and is listed on a recognised stock exchange in India. Interest on any deposits, other than time deposits, paid by a bank. (Recurring Deposit is not treated as “Time Deposit” for this purpose) In case of payment of interest by a bank on time deposits where the aggregate amounts of interest likely to be credited or paid during the financial year to the payee by a branch, does not exceed Rs

CA. Mnaish Dafria, Indore. Interest : Important Exemptions No tax is to be deducted from— Interest credited or paid to-- any banking company or any co-operative society engaged in carrying on the business of banking any financial corporation established by a Central, State or Provincial Act, the Life Insurance Corporation of India the Unit Trust of India any company or co-operative society carrying on the business of insurance any government department (Sec. 196)