TDS on salary: The central government has made it mandatory for employers to pass on the benefit of TDS/TCS deducted on non-salary income while calculating TDS to be deducted from salary from October 1, 2024. Adjusting the tax already paid by way of TDS/TCS on non-salaried income while deducting TDS from salary can reduce the TDS liability for a salaried employee.
This amendment was introduced to reduce the cases of excess TDS being deducted from salary income. While the law was already implemented and the necessary back end technical infrastructure update took time. Proteus (formerly NSDL e-Governance) has informed that the necessary changes have been made in the TDS software from December 27, 2024 and now the TDS certificate will start reflecting the updated changes for the TDS statement of the fourth quarter of 2024-25.
Salaried employees will get benefits from January 2025Â
In an Economic Times report, experts said that salaried employees may be eligible for normal TDS deduction instead of additional deduction. While additional TDS deduction has stopped from October 1, 2024, and TDS certificates from January 2025 will start showing its effect from the fourth quarter of FY 2024-25.
Understand the complete calculation hereÂ
Before October 1, 2024, salaried employees had to pay TDS twice on non-salary income. For example, your salary is Rs 10 lakh and other income from which TDS or TCS is deducted or collected is Rs 5 lakh. So earlier employers had to deduct full TDS on income of Rs 15 lakh, even if TDS or TCS was deducted or collected from that Rs 5 lakh income.
Now after this amendment, TDS will be deducted on Rs 15 lakh after giving the benefit of TDS/TCS already deducted or collected by the employer on that Rs 5 lakh income. Hence, the overall TDS amount to be deducted will be reduced.
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