The Central Board of Direct Taxes (CBDT) has issued a circular regarding TDS deduction from salary. It has been said that any person responsible for payment of salary will have to deduct income tax while paying the amount. The circular states that tax should be deducted at the average rate calculated on the basis of the rates applicable for the current financial year on the income (income) from the estimated salary of the recipient for that year.
What is this circular
According to media report, the CBDT had issued the circular last week. It explains the liability of employers with respect to deduction of tax at source from salary under section 192 of the Income Tax Act, 1961 for the financial year 2022-23. As per section 192, the person responsible for making the payment of salary income must furnish to the payee a statement giving true and complete details of the perquisites or benefits in lieu of salary provided to him and the value thereof.
TDS will have to be deposited this much every month
For example, if someone’s annual income from salary is Rs.6,00,000, then the tax on the total salary including cess, according to the normal rate, becomes Rs.33,800. Calculating tax on Rs 50,000 at the average tax rate of 5.63 per cent works out to Rs 2,815. That is, TDS (TDS) of Rs 235 will have to be deducted every month on this amount.
What is the current income tax slab
Currently, there is no income tax on annual income up to Rs 2.50 lakh. 5 percent income tax has to be paid on income from Rs 2.50 lakh to Rs 5 lakh. 10 percent income tax is applicable on Rs 5 lakh to Rs 7.50 lakh. 15 per cent on annual income from Rs 7,50,001 to Rs 10 lakh, 20 per cent on annual income from Rs 10,00,001 to Rs 12.50 lakh, 25 per cent on annual income from Rs 12,50,001 to Rs 15 lakh and above Rs 15 lakh 30 percent income tax has to be paid on the income of Rs.
