07-11-2011, 08:23 PM
<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 />Hi
I have an employee who joined our organization on 16 Aug 2010. His total annual income till June 30 2011 is 748,306.
Considering that he worked 11 months in the organization, should i deduct tax on 748,306.
One of my colleagues is suggesting that we should add 60,000 (his salary) to this 748,306 to check the tax bracket.
any advise?
<hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">
There is nothing in law that suggests you to add salary of the months during which the employee had not joined you, to work out the basis of deduction of tax. This will be sheer injustice to a person who has remained unemplyed for those months. This step would put him under th hardships of pursuing refund and may be to pay bribe for the same.
s.149 requires you to deduct tax on his estimated annual income. In order to work out the estimate you may ask your new employee to provide you in writing whether he was employed during the earlier months of the tax year. If yes, what salary was he drawing. On that basis you may work out his estimate.
If on the salary drawn by him, tax has been withheld, then ask him to furnish tax withholding certificate from the previous employer.
If he states that he was unemployed then take the earlier months income as zero, for calculating his estimated annual income.
Remember, it is estimated income on which you have to deduct tax u/s149, and estimate must have some footing. You can easily deduct tax but employee can't obtain refund so easily.
<br />Hi
I have an employee who joined our organization on 16 Aug 2010. His total annual income till June 30 2011 is 748,306.
Considering that he worked 11 months in the organization, should i deduct tax on 748,306.
One of my colleagues is suggesting that we should add 60,000 (his salary) to this 748,306 to check the tax bracket.
any advise?
<hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">
There is nothing in law that suggests you to add salary of the months during which the employee had not joined you, to work out the basis of deduction of tax. This will be sheer injustice to a person who has remained unemplyed for those months. This step would put him under th hardships of pursuing refund and may be to pay bribe for the same.
s.149 requires you to deduct tax on his estimated annual income. In order to work out the estimate you may ask your new employee to provide you in writing whether he was employed during the earlier months of the tax year. If yes, what salary was he drawing. On that basis you may work out his estimate.
If on the salary drawn by him, tax has been withheld, then ask him to furnish tax withholding certificate from the previous employer.
If he states that he was unemployed then take the earlier months income as zero, for calculating his estimated annual income.
Remember, it is estimated income on which you have to deduct tax u/s149, and estimate must have some footing. You can easily deduct tax but employee can't obtain refund so easily.
