Search Results For: tax deducted at source


QUERY: By mistake deduction of tax at source has been made at wrong rate / lower rate / due to omission in the calculation of surcharge / education cess. While filing return of income, the employee pays the differential amount as self assessment tax. Subsequently on TDS assessment, demand is raised on the employer for the same differential amount. Employer proposes to recover the said amount from the employee. Is the employer justified in doing so or is there any remedy available to the employer?
ANSWER: Click here to read the full answer of the expert
EXPERT:
SECTION(S): , ,
GENRE:
CATCH WORDS: , ,

– Basic duty to pay the tax is of the employee, however, as a vicarious liability, the employer has to deduct the tax. So, if the employee has paid the difference; no tax could be recovered from the employer.

QUERY: Is there any provision whereby employer can give refund of excess tax deducted to the employee within the year/after year end?
ANSWER: Click here to read the full answer of the expert
EXPERT:
SECTION(S):
GENRE:
CATCH WORDS: , ,

– No. An employer has right to adjust during the financial year u/s. 192(3)

QUERY: X is in employment of of A Ltd. drawing salary of Rs. 4,20,540/-. During the year, he contributes Rs. 30,000/- to PPF. He has disclosed the following additional information to the employer:-

Rs.

Professional income from Consultancy (Net) 50,000

TDS u/s. 194J on consulting income 20,000

Losses under the head House Property (1,40,000)

Loss under the head Short Term
Capital Gain (5,000)

Donation covered u/s. 80G 50,000

What will be the withholding tax liability and how will it be calculated by the employer?
ANSWER: Click here to read the full answer of the expert
EXPERT:
SECTION(S): , ,
GENRE:
CATCH WORDS: , , ,

– As per S. 192(2B), where an employee having any income chargeable under the head “Salaries” has in addition, any income chargeable under any other head of income for the financial year, he may send to his employer, a statement of particulars of such other income and the tax, if any, deducted thereon and also the loss, if any, under the head “Income from house property”

QUERY: If a person has two employers simultaneously, on whom does the liability to deduct tax at source arise?
ANSWER: Click here to read the full answer of the expert
EXPERT:
SECTION(S):
GENRE:
CATCH WORDS: ,

As per choice of employee to whom he may furnish the details of other employment, details of TDS and other details as per sec. 192(2)

QUERY: What is the employers responsibility and liability in respect of employee joining employment in the middle of the financial year. The employee is unwilling to give details of salary and withholding tax from previous employment. Should the new employer consider the following while deducting the tax at source?

• Basic exemption limit

• Investments made during the previous year but prior to joining the employment.
ANSWER: Click here to read the full answer of the expert
EXPERT:
SECTION(S):
GENRE:
CATCH WORDS: ,

To obtain, if employee furnishes, details of income under the head “salaries” due or received by him from the other employer or employers, the TDS and such other information as the employee may furnish in Form No. 12B.

QUERY: The Municipal Council is discharging their various functions as provided under the relevant Act and Rules framed thereunder. One of the functions of the Municipal Council is to keep the town neat, clean and maintain sanitation either by employing their own employees or labourers or by allotting the said work to external agencies / outsiders by following due procedure of the law, for which agreements have been entered into.

Moreover the Municipal Council effect purchases of required materials and goods etc. from various vendors for the purpose of their own use.

The query is as to under what provisions of Law, payments made by the Municipal Council to the above persons are covered for the purpose of making TDS along with their Rates of TDS?
ANSWER: Click here to read the full answer of the expert
EXPERT:
SECTION(S): ,
GENRE:
CATCH WORDS: , ,

From the query, it is clear that work of cleaning town and maintaining sanitation by Municipal Council through its employees would be covered by section 192 of the Act and, tax would be deducted if the salary / wages paid are above the basic exemption limit at rate applicable.

QUERY: Ajay was seconded to US for 11 months by his company to work in its parent company while being on Indian company payroll. As per US do-mestic tax laws, Ajay was advised to offer his US sourced income which is nothing but his 11 months salary received in India while being in US. However since the salary was being paid in India, the TDS u/s. 192 was accordingly deducted while remitting the salary to Ajay in his Indian bank account. Now Ajay (since qualifying as a Non-resident) wants to know instead of claiming the exclusion as per Article 16(1) as prescribed in Indo-US DTAA in his return of income, can the same be claimed in his Form 16 itself?
ANSWER: Click here to read the full answer of the expert
EXPERT:
SECTION(S): , ,
GENRE:
CATCH WORDS: ,

As Ajay was seconded to USA for 11 months by his company to work in its parent company, while being on India company’s payroll, he does not become a non-resident as per section 6(1)(c) of the Income-tax Act, 1961.

QUERY: Mr. X has purchased single premium money back plan of LIC; called New Bima Bachat Policy. Sum assured is Rs. 7,00,000/-. He has paid a single premium of Rs. 5,59,843/-. He will be getting Rs. 1,05,000/- as survival bonus after every three years from LIC during the span of 15 years and there after the sum assured with Bonus on maturity.

The survival bonus and sum assured with bonus, receivable during the life time of Mr. X, is taxable in his hands as there is no exemption available as per the provisions of section 10 (10D) of the Income tax Act. There will be TDS also on this amount. Mr. X has not claimed deduction under section 80C on this premium paid, which in any case would have been Rs. 70,000/- only.

In this connection, the following questions arise:

1. Is there any specific provision under the Income tax Act by which this amount is taxed under the head “Income from other sources”?

2. Is it possible to show the income under head Capital Gain?

3. Is there any provision to claim the investment made in the policy as cost against the survival benefits?

4. If yes then how the same is to be claimed i.e. can one claim the cost by dividing it against the survival benefit receivable after every three years and then pay tax on entire amount received on maturity.


5. If the investment made is not allowed to be deducted from the survival amount receivable, will it not be unconstitutional as this will amount to taxing gross receipt and not income.
ANSWER: Click here to read the full answer of the expert
EXPERT:
SECTION(S): , , ,
GENRE:
CATCH WORDS: , , , , ,

From the facts, it is clear that Mr. X has taken money back insurance policy called as New Bima Bachat Policy. As per the terms of the said policy, it is a single premium payment policy, where sum assured will be paid back to the policy holder in the form of survival benefit periodically.

QUERY: Mr. X a practicing Advocate who is subject to Tax Audit u/s. 44AB for the year ending March 31, 2008 having the following transactions during the financial year 2009-10

1. Constructed a house for self occupation & he is making payment to contractor Rs. 10,00,000/-.

2. Making payment to Architect for designing his house Rs. 1,00,000/-.

3. Borrowed funds from friends Rs. 10,00,000/- on which he wants to pay the interest.

Examine the applicability of TDS.
ANSWER: Click here to read the full answer of the expert
EXPERT:
SECTION(S): , ,
GENRE:
CATCH WORDS: , ,

1. Section 194(C) provides that no individual or HUF shall be liable to TDS on the sum credited or paid to the account of the contractor where such sum is credited or paid exclusively for personal purpose of such individual or any member of HUF.

QUERY: Whether the decision of GC India Technology Centre P. Ltd. vs CIT [327 ITR 456 (SC)] can be taken advantage under section 40(a)(ia) to say that tax was not chargeable and hence tax need not be deducted on the payment?
ANSWER: Click here to read the full answer of the expert
EXPERT:
SECTION(S):
GENRE:
CATCH WORDS: ,

Yes, the Supreme Court has confirmed that the obligation to deduct tax at source arises only if “sum is chargeable under the provisions of the Act” but it is not clear from the query how any interest,