08-13-2011, 04:48 AM
@student of law#8626;
continuing the example of an employee who joined the organisation in the month of june at a salary of 250k per month since the salary is below taxable limits therefore estimated taxable income would be nil and employer would not deduct any tax from his salary (as per your comment employer has no obligation to ask employee for his previous employment). Assuming the said employee was employed in the previous 11months of the tax year at the same salary of 250k and his previous employer deducted tax @ of 17.5%. But his new employer didnt deduct tax as aforesaid, the real annual income and tax liability would have been 3 m and 525,000(3m @17.5) respectively, but in the case in discussion the tax liability/deducted and paid would be 481,250. As per sec 115 employee whose employer has filed annual statement shall be treated as filed return of income. Also as per sec 120 a person who has filled complete return of income, the commissioner shall be taken to have made assessment of taxable income. So in this case the employee paid tax short of 43,750 but has this assessed lawfully. i think employer is required to obtain documetary evidence of tax witheld from employee during tax year under clause i of 149(1). If this is right then new employer should deduct tax @17.5% . Please guide me.(<blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by student_of_law</i>
<br /><blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by talha.moin</i>
<br />Thanks for the advice and all the guidance.
So, it means if someone joins us in June and we pay him 250k in June as salary and he doesn't give info about his previous employment, we will not deduct tax as it's not exceeding 300k during the tax year with us. Am I right?
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Yes, sure.
However, for further safeguarding your organization, you may take indemnity letter from your employee. Wherein employee will undertake that he has represented that his Salary income for the year is below taxable limit and the company should not deduct tax. If the company suffers any loss or expenditure for this non deduction it may deduct it later from employee's salary
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continuing the example of an employee who joined the organisation in the month of june at a salary of 250k per month since the salary is below taxable limits therefore estimated taxable income would be nil and employer would not deduct any tax from his salary (as per your comment employer has no obligation to ask employee for his previous employment). Assuming the said employee was employed in the previous 11months of the tax year at the same salary of 250k and his previous employer deducted tax @ of 17.5%. But his new employer didnt deduct tax as aforesaid, the real annual income and tax liability would have been 3 m and 525,000(3m @17.5) respectively, but in the case in discussion the tax liability/deducted and paid would be 481,250. As per sec 115 employee whose employer has filed annual statement shall be treated as filed return of income. Also as per sec 120 a person who has filled complete return of income, the commissioner shall be taken to have made assessment of taxable income. So in this case the employee paid tax short of 43,750 but has this assessed lawfully. i think employer is required to obtain documetary evidence of tax witheld from employee during tax year under clause i of 149(1). If this is right then new employer should deduct tax @17.5% . Please guide me.(<blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by student_of_law</i>
<br /><blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by talha.moin</i>
<br />Thanks for the advice and all the guidance.
So, it means if someone joins us in June and we pay him 250k in June as salary and he doesn't give info about his previous employment, we will not deduct tax as it's not exceeding 300k during the tax year with us. Am I right?
<hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">
Yes, sure.
However, for further safeguarding your organization, you may take indemnity letter from your employee. Wherein employee will undertake that he has represented that his Salary income for the year is below taxable limit and the company should not deduct tax. If the company suffers any loss or expenditure for this non deduction it may deduct it later from employee's salary
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