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One can consider the following categories for tax exemption. In the case of tax exemption, the employer required to obtain a declaration and proof from the employees to approve the tax declaration. However, TDS on salary can be calculated by deducting the exemption from the total annual income specified by the Income Tax Department. This in turn allows a person to look at different types of investments for a particular financial year.
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READ ALSO : TDS Rates Chart FY 2020-21 In India Income Tax slabs on Salary Commissions and other profits on the sale of lottery tickets, payment of insurance commission, commission or brokerage, rent, and so on. Repurchase of units by Unit Trust of India or Mutual Funds Rewards from winning payments, lottery tickets, or crossword puzzles. Therefore, Some of these include Fees for technical or commercial services, payment to contractors and subcontractors, payment of dividends, interest earned on securities, interest earned on bank deposits. Then the concept of salary does not work while the payment is given and income earned. If there no relationship between two parties and employer and employee ‘related to the payment terms. Salary the type of payment received at a specific interval and by a specific amount to provide certain services according to a contract signed by two parties – the employer and the employee. To calculate TDS for salary – it is mandatory to define which income comes under salary.
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The employer will estimate the taxable income and start deducting tax on a monthly basis as a deduction tax at the source (TDS) before giving the monthly salary to the employee. These investment declarations called for so that the tax deduction made accordingly.īased on the statement of investment declaration. Most organizations ask their salaried employees to send a declaration of their investment at the beginning of every financial year.
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TDS DEDUCTION IN SALARY SLIP PROFESSIONAL
TDS applies to salaries, commissions, royalty payments, brokerage, contract payments, interest earned on many financial investments, income from lotteries, rental income, professional fees, etc.
TDS DEDUCTION IN SALARY SLIP HOW TO
How to calculate TDS on Salary? TDS is a medium of collecting Income Tax in India under the Indian Income Tax Act of 1961.