Tax Management India. Com
Law and Practice  :  Digital eBook
Research is most exciting & rewarding


  TMI - Tax Management India. Com
Follow us:
  Facebook   Twitter   Linkedin   Telegram

TMI Blog

Home

Income Tax deduction from salaries during the Financial Year 2015-16 under section 192 of the Income-Tax Act, 1961

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... Department- w ww.incometaxindia.gov.in. 2. RATES OF INCOME-TAX AS PER FINANCE ACT, 2015 : As per the Finance Act, 2015 , income-tax is required to be deducted under Section 192 of the Act from income chargeable under the head Salaries for the financial year 2015-16 (i.e. Assessment Year 2016-17) at the following rates: 2.1 Rates of tax A. Normal Rates of tax: Sl No Total Income Rate of tax 1 Where the total income does not exceed ₹ 2,50,000/-. Nil 2 Where the total income exceeds ₹ 2,50,000/- but does not exceed ₹ 5,00,000/-. 10 per cent of the amount by which the total income exceeds ₹ 2,50,000/- 3 Where the total income exceeds ₹ 5,00,000/- but does not exceed ₹ 10,00,000/-. ₹ 25,000/- plus 20 per cent of the amount by which the total income exceeds ₹ 5,00,000/-. 4 Where the total income exceeds ₹ 10,00,000/-. ₹ 1,25,000/- .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... 1) of section 2 of the Income-tax Act, having a total income exceeding one crore rupees, be increased by a surcharge for the purpose of the Union calculated at the rate of twelve per cent of such income-tax: Provided that in the case of persons mentioned above having total income exceeding one crore rupees, the total amount payable as income-tax and surcharge on such income shall not exceed the total amount payable as income-tax on a total income of one crore rupees by more than the amount of income that exceeds one crore rupees. 2.3.1 Education Cess on Income tax: The amount of income-tax including the surcharge if any, shall be increased by Education Cess on Income Tax at the rate of two percent of the income-tax. 2.3.2 Secondary and Higher Education Cess on Income-tax: An additional education cess is chargeable at the rate of one percent of income-tax including the surcharge if any, but not including the Education Cess on income tax as in 2.3.1. 3. SECTION 192 OF THE INCOME-TAX ACT, 1961 : BROAD SCHEME OF TAX DEDUCTION AT SOURCE FROM SALARIES : 3.1 Method of Tax Calculation: Every person who is responsible for paying any income chargeable u .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... 2285/- Amount required to be deposited each month ₹ 190 ((Rs. 190.40) =2285/12) The tax so paid by the employer shall be deemed to be TDS made from the salary of the employee. 3.3 Salary From More Than One Employer: Section 192(2) deals with situations where an individual is working under more than one employer or has changed from one employer to another. It provides for deduction of tax at source by such employer (as the tax payer may choose) from the aggregate salary of the employee, who is or has been in receipt of salary from more than one employer. The employee is now required to furnish to the present/chosen employer details of the income under the head Salaries due or received from the former/other employer and also tax deducted at source therefrom, in writing and duly verified by him and by the former/other employer . The present/chosen employer will be required to deduct tax at source on the aggregate amount of salary (including salary received from the former or other employer). 3.4 Relief When Salary Paid in Arrear or Advance: 3.4.1 Under section 192(2A) where the assessee, being a Govern .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... ing the amount of tax to be deducted. 3.6 Computation of income under the head Income from house property : While taking into account the loss from House Property, the DDO shall ensure that the employee files the declaration referred to above and encloses therewith a computation of such loss from house property. Following details shall be obtained and kept by the employer in respect of loss claimed under the head Income from house property separately for each house property: a) Gross annual rent/value b) Municipal Taxes paid, if any c) Deduction claimed for interest paid, if any d) Other deductions claimed e) Address of the property f) Amount of loan, if any; and g) Name and address of the lender (loan provider) 3.6.1 Conditions for Claim of Deduction of Interest on Borrowed Capital for Computation of Income From House Property [ Section 24(b) ]: Section 24(b) of the Act allows deduction from income from houses property on interest on borrowed capital as under:- (i) the deduction is allowed only in case of house property which is owned and is in the occupation of the employee for his own residence. However, if it is actually not occ .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... foreign currency, the value in rupees of such salary shall be calculated at the Telegraphic transfer buying rate of such currency as on the date on which tax is required to be deducted at source ( see Rule 26 ). 4. PERSONS RESPONSIBLE FOR DEDUCTING TAX AND THEIR DUTIES: 4.1. As per section 204(i) of the Act , in the context of payments other than payments by the Central Government of the State Government the persons responsible for paying for the purpose of Section 192 means the employer himself or if the employer is a Company, the Company itself including the Principal Officer thereof. Further, as per Section 204(iv) , in case the credit, or as the case may be, the payment is made by or on behalf of Central Government or State Government, the DDO or any other person by whatever name called, responsible for crediting, or as the case may be, paying such sum is the persons responsible for paying for the purpose of Section 192. 4.2. The tax determined as per para 9 should be deducted from the salary u/s 192 of the Act. 4.3. Deduction of Tax at Lower Rate: If the jurisdictional TDS officer of the Taxpayer issues a certificate of No Deduction or .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... 30th April next Financial Year 4.4.2 Mode of Payment of TDS 4.4.2.1 Compulsory filing of Statement by PAO, Treasury Officer, etc in case of payment of TDS by Book Entry u/ s 200 (2A) : In the case of an office of the Government, where tax has been paid to the credit of the Central Government without the production of a challan [ Book Entry ], the Pay and Accounts Officer or the Treasury Officer or the Cheque Drawing and Disbursing Officer or any other person by whatever name called to whom the deductor reports about the tax deducted and who is responsible for crediting such sum to the credit of the Central Government, shall‐ (a) submit a statement in Form No. 24G under section 200 (2A) within ten days from the end of the month to the agency authorized by the Director General of Income‐tax (Systems) [TIN Facilitation Centres currently managed by M/s National Securities Depository Ltd ] in respect of tax deducted by the deductors and reported to him for that month; and (b) intimate the number (hereinafter referred to as the Book Identification Number or BIN) generated by the agency to each of the deductors in respect .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... the Central Government within the prescribed time, he shall be liable to action in accordance with the provisions of section 201 and shall be deemed to be an assessee-in-default in respect of such tax and liable for penal action u/s 221 of the Act. Further Section 201(1A) provides that such person shall be liable to pay simple interest (i) at the rate of 1% for every month or part of the month on the amount of such tax from the date on which such tax was deductible to the date on which such tax is deducted; and (ii) at the rate of one and one-half percent for every month or part of a month on the amount of such tax from the date on which such tax was deducted to the date on which such tax is actually paid. Such interest, if chargeable, is mandatory in nature and has to be paid before furnishing of quarterly statement of TDS for respective quarter. 4.5.2 Section 271C inter alia lays down that if any person fails to deduct whole or any part of tax at source or fails to pay the whole or part of tax under the second proviso to section 194B , he shall be liable to pay, by way of penalty, a sum equal to the amount of tax not deducted or paid by him. 4.5.3 Furthe .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... after due authentication and verification alongwith the Part A of the Form No. 16 . It may be noted that under the new TDS procedure, TAN of deductee/ PAN of the deductee and receipt number of TDS statement filed by the deductor act as unique identifier for granting online credit of TDS to the decutee. Hence due care should be taken in filling these particulars. Due care should also be taken in indicating correct CIN/ BIN in TDS statement. If the DDO fails to issue these certificates to the person concerned, as required by section 203 , he will be liable to pay, by way of penalty, under section 272A(2)(g) , a sum which shall be ₹ 100/- for every day during which the failure continues. It is, however, clarified that there is no obligation to issue the TDS certificate in case tax at source is not deductible/deducted by virtue of claims of exemptions and deductions . [Note: TRACES is a web-based application of the Income - tax Department that provides an interface to all stakeholders associated with TDS administration. It enables viewing of challan status, downloading of NSDL Conso File, Justification Report and Form 16 / 16A as well as viewing of annual .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... for which such assessee was employed with each of the employers and Part B may be issued by each of the employers or the last employer at the option of the assessee. 4.6.3. Authentication by Digital Signatures : (i) Where a certificate is to be furnished in Form No. 16 , the deductor may, at his option, use digital signatures to authenticate such certificates. (ii) In case of certificates issued under clause (i), the deductor shall ensure that (a) the conditions prescribed in para 4.6.1 above are complied with; (b) once the certificate is digitally signed, the contents of the certificates are not amenable to change; and (c) the certificates have a control number and a log of such certificates is maintained by the deductor. The digital signature is being used to authenticate most of the e-transactions on the internet as transmission of information using digital signature is failsafe. It saves time specially in organisations having large number of employees where issuance of certificate of deduction of tax with manual signature is time consuming ( Circular no 2 of 2007 dated 21.05.2007 ) 4.6.4. Furnishing of particulars pertaining to perquisites, .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... deductions, exemptions or allowances or set-off of certain loss as per the provisions of the Act for the purpose of estimating the income of the assessee or computing the amount of tax deductible under the said section. The evidence /proof /particulars for some of the deductions/exemptions/allowances/set-off of loss claimed by the employee such as rent receipt for claiming deduction in HRA, evidence of interest payments for claiming loss from self-occupied house property, etc is not available to the DDO. To bring certainity and uniformity in this matter, Finance Act, 2015 inserted section 192(2D) . Section 192(2D) provides that person responsible for paying (DDOs) shall obtain from the assessee evidence or proof or particular of the prescribed claim (including claim for set off of loss) in the form and manner as may be prescribed. 4.7 Mandatory Quoting of PAN and TAN: 4.7.1 Section 203A of the Act makes it obligatory for all persons responsible for deducting tax at source to obtain and quote the Tax deduction and collection Account No (TAN) in the challans, TDS-certificates, statements and other documents. Detailed instructions in this regard are available in t .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... , tax is to be deducted at the average rate. Education cess @ 2% and Secondary and Higher Education Cess @ 1% is not to be deducted, in case the tax is deducted at 20% u/s 206AA of the Act . 4.9 Statement of deduction of tax under section 200(3) [Quarterly Statement of TDS]: 4.9.1 The person deducting the tax (employer in case of salary income), is required to file duly verified Quarterly Statements of TDS in Form 24Q for the periods [details in Table below] of each financial year, to the TIN Facilitation Centres authorized by DGIT (System s) which is currently managed by M/s National Securities Depository Ltd (NSDL). Particulars of e-TDS Intermediary at any of the TIN Facilitation Centres are available at http://www.incometaxindia.gov.in and http://tin-nsdl.com portals. The requirement of filing an annual return of TDS has been done away with w.e.f. 1.4.2006. The quarterly statement for the last quarter filed in Form 24Q (as amended by Notification No. S.O.704(E) dated 12.5.2006 ) shall be treated as the annual return of TDS. Due dates of filing this statement quarterwise is as in the Table below. TABLE: Dates of filing Quarterly Statements E-TDS Ret .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... ment, in respect of tax deducted at source on or after 1.07.2012, he shall be liable to pay, by way of penalty a sum which shall not be less than ₹ 10,000/- but which may extend to ₹ 1,00,000/-. However, the penalty shall not be levied if the person proves that after paying TDS with the fee and interest, if any, to the credit of Central Government, he had delivered such statement before the expiry of one year from the time prescribed for delivering the statement. 4.9.7 At the time of preparing statements of tax deducted, the deductor is required to: (i) mandatory quote his tax deduction and collection account number (TAN) in the statement; (ii) mandatory quote his permanent account number (PAN) in the statement except in the case where the deductor is an office of the Government( including State Government). In case of Government deductors PANNOTREQD to be quoted in the e-TDS statement; (iii) mandatory quote of permanent account number PAN of all deductees; (iv) furnish particulars of the tax paid to the Central Government including book identification number or challan identification number, as the case may be. (v) furnish particular of amounts paid .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... to him in the previous year by or on behalf of an employer or a former employer though not due or before it became due to him. (c) any arrears of salary paid or allowed to him in the previous year by or on behalf of an employer or a former employer, if not charged to income-tax for any earlier previous year. (2) For the removal of doubts, it is clarified that where any salary paid in advance is included in the total income of any person for any previous year it shall not be included again in the total income of the person when the salary becomes due. Any salary, bonus, commission or remuneration, by whatever name called, due to, or received by, a partner of a firm from the firm shall not be regarded as Salary . 5.2 DEFINITION OF SALARY , PERQUISITE AND PROFIT IN LIEU OF SALARY ( SECTION 17 ): 5.2.1 Salary includes:- i. wages, fees, commissions, perquisites, profits in lieu of, or, in addition to salary, advance of salary, annuity or pension, gratuity, payments in respect of encashment of leave etc. ii. the portion of the annual accretion to the balance at the credit of the employee participating in a recognized provident fund as consists of {Rule 6 .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... the assessee. V. Any sum payable by the employer, whether directly or through a fund, other than a recognized provident fund or an approved superannuation fund or other specified funds u/s 17 , to effect an assurance on the life of an assessee or to effect a contract for an annuity. VI. The value of any specified security or sweat equity shares allotted or transferred , directly or indirectly, by the employer, or former employer , free of cost or at concessional rate to the employee and for this purpose, . (a) specified security means the securities as defined in section 2(h) of the Securities Contracts (Regulation) Act, 1956 and, where employees stock option has been granted under any plan or scheme therefor, includes the securities offered under such plan or scheme; (b) sweat equity shares means equity shares issued by a company to its employees or directors at a discount or for consideration other than cash for providing know-how or making available rights in the nature of intellectual property rights or value additions, by whatever name called; (c) the value of any specified security or sweat equity shares shall be the fair market value of the specified .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... vided is taken on lease/ rent by the employer: The prescribed rate is 15% of the salary or the actual amount of lease rental payable by the employer, whichever is lower, as reduced by any amount of rent paid by the employee. Meaning of Salary for the purpose of calculation of perquisite in respect of Residential Accommodation : a. Basic Salary ; b. Dearness Allowance, or Dearness Pay if it enters into the computation of superannuation or retirement benefit of the employees; c. Bonus ; d. Commission ; e. All other taxable allowances (excluding the portion not taxable ); and f. Any monetary payment which is chargeable to tax (by whatever name called). Salary from all employers shall be taken into consideration in respect of the period during which an accommodation is provided. Where on account of the transfer of an employee from one place to another, he is provided with accommodation at the new place of posting while retaining the accommodation at the other place, the value of perquisite shall be determined with reference to only one such accommodation which has the lower value for a period not exceeding 90 days and thereafter the value of perquisite shall .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... xecution site or a dam site or a power generation site or an off-shore site will not be treated as a perquisite if: i) such accommodation is located in a remote area or ii) where it is not located in a remote area , the accommodation is of a temporary nature having plinth area of not more than 800 square feet and should not be located within 8 kilometers of the local limits of any municipality or cantonment board. A project execution site here means a site of project up to the stage of its commissioning. A remote area means an area located at least 40 kilometers away from a town having a population not exceeding 20,000 as per the latest published all-India census. II Perquisite on Motor car provided by the Employer [ Rule 3(2) ]: (1) If an employer provides motor car facility to his employee, the value of such perquisite shall be : a) Nil, if the motor car is used by the employee wholly and exclusively in the performance of his official duties. b) Actual expenditure incurred by the employer on the running and maintenance of motor car including remuneration to chauffeur as increased by the amount representing normal wear and tear of the motor car and as .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... ndants etc. [ Rule 3(3) ]: The value of free service of all personal attendants including a sweeper, gardener and a watchman is to be taken at actual cost to the employer. Where the attendant is provided at the residence of the employee, full cost will be taxed as perquisite in the hands of the employee irrespective of the degree of personal service rendered to him. Any amount paid by the employee for such facilities or services shall be reduced from the above amount. IV Gas, electricity water for household consumption [ Rule 3(4) ]: The value of perquisite in the nature of gas, electricity and water shall be the amount paid by the employer. Where the supply is made from the employer's own resources, the manufacturing cost per unit incurred by the employer would be taken for the valuation of perquisite. Any amount paid by the employee for such facilities or services shall be reduced from the perquisite value. V Free or concessional education [ Rule 3(5) ]: Perquisite on account of free or concessional education for any member of the employee s household shall be determined as the sum equal to the amount of expenditure incurred by the employer in that behalf. Howeve .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... cal reimbursement is not reimbursed under any medical insurance scheme. Where any medical insurance reimbursement is received, the perquisite value at the prescribed rate shall be charged from the date of reimbursement on the amount reimbursed, but not repaid against the outstanding loan taken specifically for this purpose. VIII Perquisite on account of travelling, touring, accommodation and any other expenses paid for or reimbursed by the employer for any holiday availed [ Rule 3(7)(ii) ]: The value of perquisite on account of travelling, touring, accommodation and any other expenses paid for or reimbursed by the employer for any holiday availed of by the employee or any member of his household, other than leave travel concession (as per section 10(5) ), shall be the amount of the expenditure incurred by the employer in that behalf. However, any amount recovered from or paid by the employee shall be reduced from the perquisite value so determined. Where such facility is maintained by the employer, and is not available uniformly to all employees, the value of benefit shall be taken to be the value at which such facilities are offered by other agencies to the public. .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... mbursed by the employer is taxable on the following basis: Amount of expenditure incurred by the employer XXX Less : Expenditure on use for official purposes XXX Less : Amount, if any, recovered from the employee XXX XXX Amount taxable as perquisite XXX However if the amount is incurred wholly and exclusively for official purposes it will be exempt if the following conditions are fulfilled i) Complete details of such expense, including date and nature of expenditure and its business expediency is maintained by the employer. ii) Employer gives a certificate that the same was incurred wholly and exclusively for official purpose. Note: 1) Health club, sport facilities etc. provided uniformly to all classes of employee by the employer at the employer s premises and expenditure incurred on them are exempt. 2) The initial one-time deposits or fees for corporate or institutional membership, where benefit does not remain with a particular employee after cessation of employment are exempt. Initial fees / deposits, in such case, is not included. XII Use of assets [ Rule 3(7)(vi .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... s in lieu of salary' shall include I. the amount of any compensation due to or received by an assessee from his employer or former employer at or in connection with the termination of his employment or the modification of the terms and conditions relating thereto; II. any payment (other than any payment referred to in clauses (10) , ( 10A) , ( 10B ) , ( 11 ), ( 12) ( 13 ) or ( 13A ) of section 10 due to or received by an assessee from an employer or a former employer or from a provident or other fund, to the extent to which it does not consist of contributions by the assessee or interest on such contributions or any sum received under a Keyman insurance policy including the sum allocated by way of bonus on such policy. Keyman insurance policy shall have the same meaning as assigned to it in section 10( 10D ); III. any amount due to or received, whether in lump sum or otherwise, by any assessee from any person- ( A ) before his joining any employment with that person; or ( B ) after cessation of his employment with that person. 5.3 INCOMES NOT INCLUDED UNDER THE HEAD SALARIES (EXEMPTIONS) Any income falling within any of the .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... of posts connected with defence or of civil posts under the Union (such members or holders being persons not governed by the said Rules) or to the members of the all- India services or to the members of the defence services or to the members of the civil services of a State or holders of civil posts under a State or to the employees of a local authority] or a corporation established by a Central, State or Provincial Act, is exempt under Section10(10A)(i). As regards payments in commutation of pension received under any scheme of any other employer, exemption will be governed by the provisions of section 10(10A)(ii) . Also, any payment in commutation of pension from a fund referred to in Section 10(23AAB) is exempt under Section 10(10A)(iii) . 5.3.4 Any payment received by an employee of the Central Government or a State Government, as cash-equivalent of the leave salary in respect of the period of earned leave at his credit at the time of his retirement , whether on superannuation or otherwise, is exempt under Section 10(10AA)(i) . In the case of other employees, this exemption will be determined with reference to the leave to their credit at the time of retirement o .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... loyees of the Central Government and State Government and employees of notified institutions having importance throughout India or any State or States. It may also be noted that where this exemption has been allowed to any employee for any assessment year, it shall not be allowed to him for any other assessment year. Further, if relief has been allowed under section 89 for any assessment year in respect of amount received on voluntary retirement or superannuation, no exemption under section 10(10C) shall be available. 5.3.7 Any sum received under a Life Insurance Policy ( Sec 10(10D) , including the sum allocated by way of bonus on such policy other than the following is exempt under section 10(10D) : i) any sum received under section 80DD(3) or section 80DDA(3); or ii) any sum received under a Keyman insurance policy; or iii) any sum received under an insurance policy issued on or after 1.4.2003, but on or before 31-03-2012, in respect of which the premium payable for any of the years during the term of the policy exceeds 20 percent of the actual capital sum assured; or iv) any sum received under an insurance policy issued on or after 1.4.2012 in respect of .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... y the assessee subject to the limits laid down in Rule 2A , qualifies for exemption from income-tax. Thus, house rent allowance granted to an employee who is residing in a house/flat owned by him is not exempt from income-tax. The disbursing authorities should satisfy themselves in this regard by insisting on production of evidence of actual payment of rent before excluding the House Rent Allowance or any portion thereof from the total income of the employee. Though incurring actual expenditure on payment of rent is a pre-requisite for claiming deduction under section 10(13A), it has been decided as an administrative measure that salaried employees drawing house rent allowance upto ₹ 3000/- per month will be exempted from production of rent receipt. It may, however, be noted that this concession is only for the purpose of tax-deduction at source, and, in the regular assessment of the employee, the Assessing Officer will be free to make such enquiry as he deems fit for the purpose of satisfying himself that the employee has incurred actual expenditure on payment of rent. Further if annual rent paid by the employee exceeds ₹ 1,00,000 per annum, it is mandatory fo .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... ent has notified a scheme called Deposit Scheme for Retiring Government Employees, 1989 for the purpose of the said clause. 5.3.12 Any scholarship granted to meet the cost of education is not to be included in total income as per provisions of section 10(16) of the Act . 5.3.13 Section 10(18) provides for exemption of any income by way of pension received by an individual who has been in the service of the Central Government or State Government and has been awarded Param Vir Chakra or Maha Vir Chakra or Vir Chakra or such other gallantry award as may be specifically notified by the Central Government. Family pension received by any member of the family of such individual is also exempt [Notifications No.S.O.1948(E) dated 24.11.2000 and 81(E) dated 29.1.2001 , which are enclosed as per Annexure VIII IX]. Family for this purpose shall have the meaning assigned to it in Section 10(5) of the Act . DDO may not deduct any tax in the case of recipients of such awards after satisfying himself about the veracity of the claim . 5.3.14 Under Section 17 of the Act , exemption from tax will also be available in respect of:- (a) the value of any med .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... Act would continue to be exempt. These include benefits like house rent allowance, leave travel concession, travel expense allowance on tour and transfer, daily allowance to meet tour expenses as prescribed, medical facilities subject to conditions. 5.3.15 In this connection it is to be noted that as per sec. 10 (14) read wit rule 2BB any allowance granted to meet the cost of travel on tour or on transfer includes any sum paid in connection with transfer, packing and transportation of personal effects o such transfer shall be exempt. Also any allowance, whether, granted for the period of journey in connection with transfer, to meet the ordinary daily charges incurred by an employee on account of absence form his normal place of duty shall be exempt. 5.4 DEDUCTIONS U/S 16 OF THE ACT FROM THE INCOME FROM SALARIES 5.4.1 Entertainment Allowance [ Section 16(ii) ]: A deduction is also allowed under section 16(ii) in respect of any allowance in the nature of an entertainment allowance specifically granted by an employer to the assessee, who is in receipt of a salary from the Government, a sum equal to one-fifth of his salary(exclusive of any allowance, benef .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... account standing in the name of an individual, or spouse or children; [The Central Government has since notified Public Provident Fund vide Notification S.O. No. 1559(E) dated 3.11.05 ] (c) by an employee to a Recognized Provident Fund; (d) by an employee to an approved superannuation fund; It may be noted that contribution to any Fund shall not include any sums in repayment of loan or advance; (5) Any sum paid or deposited during the year as a subscription :- (a) in the name of employee or a girl child of that employee including a girl child for whom the employee is the legal guardian in any such security of the Central Government or any such deposit scheme as the Central Government may, by notification in the Official Gazette, specify in this behalf; [The Central Government has since notified the scheme Sukanya Samriddhi Account vide Notification GSR No. 863(E) dated 02.12.2014] (b) to any such saving certificates as defined under section 2(c) of the Government Saving Certificate Act, 1959 as the Government may, by notification in the Official Gazette, specify in this behalf. [The Central Government has since notified National Saving Certi .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... inistrator or the specified company defined in Unit Trust of India (Transfer of Undertaking Repeal) Act, 2002, as the Central Government may, by notification in the Official Gazette, specify in this behalf; [The Central Government has since notified the Equity Linked Saving Scheme, 2005 for this purpose vide Notification S.O. No. 1563(E) dated 3.11.2005 ] (10) Any subscription made to any such deposit scheme of, or, any contribution made to any such pension fund set up by, the National Housing Bank, as the Central Government may, by notification in the Official Gazette, specify in this behalf; (11) Any subscription made to any such deposit scheme, as the Central Government may, by notification in the Official Gazette, specify for the purpose of being floated by (a) public sector companies engaged in providing long-term finance for construction or purchase of houses in India for residential purposes, or, (b) any authority constituted in India by, or, under any law, enacted either for the purpose of dealing with and satisfying the need for housing accommodation or for the purpose of planning, development or improvement of cities, towns and villages, or for both. [T .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... by him or he receives back, by way of refund or otherwise, any sum specified in section 80C(2)(xviii) , no deduction under these provisions shall be allowed in respect of such sums paid in such previous year in which the transfer is made and the aggregate amount of deductions of income so allowed in the earlier years shall be added to the total income of the assessee of such previous year and shall be liable to tax accordingly. (13) Tuition fees, whether at the time of admission or thereafter, paid to any university, college, school or other educational institution situated in India, for the purpose of full-time education of any two children of the employee. Full-time education includes any educational course offered by any university, college, school or other educational institution to a student who is enrolled full-time for the said course. It is also clarified that full-time education includes play-school activities, pre-nursery and nursery classes. It is clarified that the amount allowable as tuition fees shall include any payment of fee to any university, college, school or other educational institution in India except the amount representing payment in the nature .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... hich may be received under the policy by any person. 5.5.2 Deduction in respect of contribution to certain pension funds ( Section 80CCC ) Section 80CCC allows an employee deduction of an amount paid or deposited out of his income chargeable to tax to effect or keep in force a contract for any annuity plan of Life Insurance Corporation of India or any other insurer for receiving pension from the Fund referred to in section 10(23AAB) . However, the deduction shall exclude interest or bonus accrued or credited to the employee's account, if any and shall not exceed ₹ 1,50,000. However, if any amount is standing to the credit of the employee in the fund referred to above and deduction has been allowed as stated above and the employee or his nominee receives this amount together with the interest or bonus accrued or credited to this account due to the reason of (i) Surrender of annuity plan whether in whole or part (ii) Pension received from the annuity plan then the amount so received during the Financial Year shall be the income of the employee or his nominee for that Financial Year and accordingly will be charged to tax. Where any amount paid .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... d or deposited by the employee has been taken into account for the purposes of this section, a deduction with reference to such amount shall not be allowed under section 80C . Further it has been specified that w.e.f 01.04.09 any amount received by the employee from the New Pension Scheme shall be deemed not to have been received in the previous year if such amount is used for purchasing an annuity plan in the same previous year. It is emphasized that as per the s ection 80CCE the aggregate amount of deduction under sections 80C , 80CCC and Section 80CCD(1) shall not exceed ₹ 1,50,000/-. The deduction allowed under section 80 CCD(1B) is an additional deduction in respect of any amount paid in the NPS upto ₹ 50,000/-. However, the contribution made by the Central Government or any other employer to a pension scheme u/s 80CCD(2) shall be excluded from the limit of ₹ 1,50,000/- provided under this section. 5.5.4 Deduction in respect of investment made under an equity savings scheme ( Section 80 CCG ): Section 80CCG provides deduction wef assessment year 2013-14 in respect of investment made under notified equity saving scheme. Rajiv Ga .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... Finance Act 2013 ) any mode other than cash Aggregate allowable is ₹ 25,000/ (Rs 30000/- for senior and very senior citizen) 2 any payment on account of preventive health check-up of the employee or family, [restricted to ₹ 5000/-; cash payment allowed here] any mode including cash 3 Whole of the amount paid on account of medical expenditure incurred on health of a very senior citizen and no amount has been paid to effect of keep in force an insurance on the health of such person any mode other than cash Aggregate allowable is ₹ 30,000/ 4 Parent or Parents of employee* the whole of the amount paid to effect or keep in force an insurance on the health of the parent or parents of the employee any mode other than cash Aggregate allowable is ₹ 25,000/ (Rs 30000/- for senior and very senior citizen) .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... behalf for the maintenance of a dependant, being a person with disability, the employee shall be allowed a deduction of a sum of ₹ 75,000/- from his gross total income of that year. However, where such dependant is a person with severe disability , an amount ₹ 1,25,000/- shall be allowed as deduction subject to the specified conditions. The deduction under (b) above shall be allowed only if the following conditions are fulfilled:- (i) the scheme referred to in (b) above provides for payment of annuity or lump sum amount for the benefit of a dependant, being a person with disability, in the event of the death of the individual in whose name subscription to the scheme has been made; (ii) the employee nominates either the dependant, being a person with disability, or any other person or a trust to receive the payment on his behalf, for the benefit of the dependant, being a person with disability. However, if the dependant, being a person with disability, predeceases the employee, an amount equal to the amount paid or deposited under sub-para(b) above shall be deemed to be the income of the employee of the previous year in which such amount is received .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... otection of Rights and Full Participation) Act, 1995 and includes autism , cerebral palsy and multiple disability referred to in clauses (a), (c) and (h) of section 2 of the National Trust for Welfare of Persons with Autism, Cerebral Palsy, Mental Retardation and Multiple Disabilities Act, 1999; (d) Life Insurance Corporation shall have the same meaning as in clause (iii) of sub-section (8) of section 88 ; (e) medical authority means the medical authority as referred to in clause (p) of section 2 of the Persons with Disabilities (Equal Opportunities, Protection of Rights and Full Participation) Act, 1995 or such other medical authority as may, by notification, be specified by the Central Government for certifying autism , cerebral palsy , multiple disabilities , person with disability and severe disability referred to in clauses (a), (c), (h), (j) and (o) of section 2 of the National Trust for Welfare of Persons with Autism, Cerebral Palsy, Mental Retardation and Multiple Disabilities Act, 1999; (f) person with disability means a person as referred to in clause (t) of section 2 of the Persons with Disabilities (Equal Opportunities, Protection of .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... ecified in the Rules containing the name and age the patient, name of the disease/ailment along with the name, address, registration number qualification of the specialist issuing the prescription would now be required. 5.5.8 Deduction in respect of interest on loan taken for higher education ( Section 80E ): Section 80E allows deduction in respect of payment of interest on loan taken from any financial institution or any approved charitable institution for higher education for the purpose of pursuing his higher education or for the purpose of higher education of his spouse or his children or the student for whom he is the legal guardian. The deduction shall be allowed in computing the total income for the Financial year in which the employee starts paying the interest on the loan taken and immediately succeeding seven Financial years or until the Financial year in which the interest is paid in full by the employee, whichever is earlier. For the purpose of this section - (a) approved charitable institution means an institution established for charitable purposes and approved by the prescribed authority section 10(23C) , or an institution referred to in sect .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... i) any residential accommodation himself or by his spouse or minor child or where such employee is a member of a Hindu Undivided Family, by such family, at the place where he ordinarily resides or performs duties of his office or carries on his business or profession; or (ii) at any other place, any residential accommodation which is in the occupation of the employee, the value of which is to be determined under section 23(2)(a) or section 23(4)(a), as the case may be. (d) He will be entitled to a deduction in respect of house rent paid by him in excess of 10% of his total income. The deduction shall be equal to 25% of total income or ₹ 2,000/- per month, whichever is less. The total income for working out these percentages will be computed before making any deduction under section 80GG . The Drawing and Disbursing Authorities should satisfy themselves that all the conditions mentioned above are satisfied before such deduction is allowed by them to the employee. They should also satisfy themselves in this regard by insisting on production of evidence of actual payment of rent. 5.5.11 Deductions in respect of certain donations for scientific research or rural .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... total income which includes income which is chargeable under the head Profits and gains of business or profession . ii) The amount of donation exceeds ₹ 10000 and is paid in cash. The Drawing and Disbursing Authorities should satisfy themselves that all the conditions mentioned above are satisfied before such deduction is allowed by them to the employee. They should also satisfy themselves in this regard by insisting on production of evidence of actual payment of donation and a receipt from the person to whom donation has been made and ensure that the approval/notification has been issued by the right authority. DDO must ensure a self-declaration from the employee that he has no income from Profits and gains of business or profession . 5.5.12 Deduction in respect of interest on deposits in savings account ( Section 80TTA ): Section 80TTA has been introduced from the Financial Year 2012-13 and it allows to an employee from his gross total income if it includes any income by way of interest on deposits (not being time deposits) in a savings account, a deduction amounting to: (i) in a case where the amount of such income does not exceed in the aggr .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... ount of returned contributions (including interest, if any) even if a fund or part of a fund ceases to be an approved Superannuation fund. 7.3 As per section 192A of the Act, w. e. f. 01.06.2015 the trustees of the EPF Scheme 1952 framed under section 5 of the EPF Misc. Provisions Act, 1952 or any person authorized under the scheme to make payment of accumulated balance due to employees, shall, in a case where the accumulated balance due to an employee participating in a recognized provident fund is includible in his total income owing to the provisions of Rule 8 of Part A of Fourth Schedule not being applicable at the time of payment of accumulated balance due to the employee, deduct income tax thereon @ 10% if the amount of such payment or aggregate of such payment exceeds ₹ 30,000/-. In case the employee does not provide his/her PAN No., then the deduction will have to be made at maximum marginal rate. 8. DDOS TO SATISFY THEMSELVES ABOUT THE GENUINENESS OF CLAIM: The Drawing and Disbursing Officers should satisfy themselves about the actual deposits/ subscriptions / payments made by the employees, by calling for such particulars/ information as they deem .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... cted every month in equal installments. Any excess or deficit arising out of any previous deduction can be adjusted by increasing or decreasing the amount of subsequent deductions during the same financial year. 10. MISCELLANEOUS: 10.1 These instructions are not exhaustive and are issued only with a view to guide the employers to understand the various provisions relating to deduction of tax from salaries. Wherever there is any doubt, reference may be made to the provisions of the Income-tax Act, 1961 , the Income-tax Rules, 1962 , the Finance Act 2015 , the relevant circulars / notifications, etc. 10.2 In case any assistance is required, the Assessing Officer/the Local Public Relation Officer of the Income-tax Department may be contacted. 10.3 These instructions may be brought to the notice of all Disbursing Officers and Undertakings including those under the control of the Central/ State Governments. 10.4 Copies of this Circular are available with the Director of Income-tax (Public Relations, Printing Publications and Official Language), 6th Floor, Mayur Bhavan, Connaught Place, New Delhi-110 001 and at the following websites: www.finmin.nic.in www.inc .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... 180 2100 1050 7,900 3950 68,090 34,045 Total tax payable Nil 18,540 1,08,150 406850 35,06,635 (B) TDS under sec. 206AA in case where PAN is not furnished by the employee Nil 38,000 1,30,000 406850 35,06,635 * include Rebate of ₹ 2000 u/s 87A Example 2 For Assessment Year 2016-17 Calculation of Income Tax in the case of an employee below the age of sixty years having a handicapped dependent (With valid PAN furnished to employer). S.No. Particulars Rupees 1 Gross Salary 4,20,000 2 Amount spent on treatment of a dependant, being person with disability (but not severe di .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... the treatment of self and dependent family member 35,000 3 Contribution of GPF 20,000 4 LIC Premium 20,000 5 Repayment of House Building Advance 25,000 6 Tuition fees for two children 60,000 7 Investment in Unit-Linked Insurance Plan 30,000 8 Interest Income on Savings Account 8,000 9 Interest Income on Time Deposit 15,000 Computation of Tax S.No. Particulars Rupees 1 Gross Salary 5,20,000 2 Add: Perquisite in respect of reimbursement of Medical Expenses In excess of ₹ 15,000/- in view of Section 17(2)(v) 20,000 3 Income from Other Sources i) Interest Income .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... e thereon S.No. Particulars Rupees 1 Salary + Dearness Allowance + House Rent Allowance 3,50,000+2,00,000+1,40,000 = 6,90,000 6,90,000 2 Total Salary Income 6,90,000 3 Less: House Rent allowance exempt U/s 10(13A): Least of: (a). Actual amount of HRA received= 1,40,000 (b). Expenditure of rent in excess of 10% of salary (including D.A. presuming that D.A. is taken for retirement benefit) (1,44,000-55,000) = 89,000 (c). 50% of Salary(Basic+ DA) = 2,75,000 89,000 Gross Total Income 6,01,000 Less: Deduction U/s 80C (i) GPF ₹ 36,000/- (ii) LIC ₹ 4,000 (iii) Investment in Unit-Linked Insurance Plan ₹ 50,000/- Total =Rs.1,14,000/- 90,000 3 Total Income 5,11,000 Tax payable 27,200 .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... 4(b) Perquisite for hotel: Lower of (24% of salary of 2 months=Rs 33,600) and (actual payment= ₹ 1,00,000) i.e. ₹ 33,600 4(c) Perquisites for furniture(Rs.2,00,000) @ 10% of cost ₹ 20,000 4(c)(i) Total of [4(a)+(b)+(c)] (1,05,000+ 33,600+ 20,000)Rs.158,600 Less: rent recovered (-)Rs. 60,000 = ₹ 98,600 4(d) Add Perquisite for free gas, electricity, water etc. ₹ 40,000 (+) ₹ 98,600 [4(c)(i)] = ₹ 1,38,600 Total perquisites 5 Gross Total Income (Rs.8,40,000+ 1,38,600) 9,78,600 6 Gross Total Income 9,78,600 7 Less: Deduction U/s 80C: (i). Provident Fund (80C):42,000 (ii). LIC (80C):10,000 (iii). Subscription to Unit Linked Insurance Plan(80C):50,000/- Total = 1,02,000 Restricted to ₹ 1,02,000 u/s 80C 1,02,000 8 Total Income 8,76,600 .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... Rs. 2,50,000 70,000 2 Gross Total Taxable Income 6,22,000 Less: Deduction U/s 80C (i). Provident Fund: 60,000 (ii). LIP: 10,000 (iii). NSC VIII Issue: 30,000 (iv). Repayment of HBA: 60,000 (v). Tuition Fees (Restricted to two children): 20,000 Total: 1,80,000 Restricted to 1,50,000 1,50,000 Total Income 4,72,000 Income Tax thereon/payable 20,200 Add: (i). Education Cess @2% (ii). Secondary and Higher Education Cess @1% 404 202 Tot .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... of 80 years and having gross pension of: i) ₹ 5,00,000/-, ii) ₹ 8,00,000/-, iii) ₹ 12,50,000/-. B What will be the amount of TDS in case of above employees, if PAN is not submitted by them to their DDOs/Offices: Particulars Rupees (i) Rupees (ii) Rupees (iii) Gross Pension 5,00,000 8,00,000 12,50,000 Contribution of P.P.F. 80,000 1,20,000 1,50,000 Computation of Total Income and tax payable thereon Particulars Rupees (i) Rupees (ii) Rupees (iii) Gross Pension 5,00,000 8,00,000 12,50,000 Less: Deduction U/s 80C 80,000 1,20,000 1,50,000 Taxable Income 4,20,000 6,80,000 11,00,000 .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... 95,000 3. Mr. A contributed to LIC/PPR/NSC etc. 20,000 Compute Mr. A's taxable income and tax liability for A.Y. 2016-17. Computation of Tax S.No. Particulars Rupees 1 Income from Salary (a) From XYZ Ltd. Basic pay (Rs. 13,000 x 7) 91,000 Bonus 7,200 Club facility (Rs.700x 7) Rupees 4,900 H.R.A. (Rs.2,800 x 7) 19,600 Less: Exempt u/s 10(13A) 15,400 4,200 Employer's Contribution to U.R.P.F. 1,07,300 (b) From PQR Ltd. Rupees .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... A at prescribed rates, transport allowances @ ₹ 3200+DA thereon, and HRA 30% of basic pay + grade pay (though living in his own house). His date of increment is Ist July. The following are other particulars of his income. Compute his taxable income and tax payable, for A.Y.2015-16. S.No. Particulars Rupees 1. Honorarium for valuation of answer books of a departmental examination 3,000 2. Fee for work done for a private body (1/3 rd of fees has been retained by Govt.) 6,000 3. Contributions to G.P.F. p.m. 4,700 4. Postal Life Insurance Premium financed from G.P.F. p.m. 280 5. Contribution to Central Govt. Employees Group Insurance Scheme p.m. 500 6. Life Insurance Premium (being a Life Insurance Policy of ₹ 1,00,000 taken in name of his wife before 1.04.2012) 10,500 7. .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... m 39,744 1.1.2015 to 28.2.2015 @ ₹ 6,816 p.m 13,632 78,976 Less: Exempt u/s 10(14) @ 800 p.m 9600 69,376 9,73,040 Honorarium 3,000 Fees (2/3 retained by him) 4000 Total Salary 9,80,040 Less: Standard Deduction - Net Salary 9,80,040 2. Income from House Property Self-occupied u/s 23(2)(a) deemed at nil Less: Interest on HD .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... Amount, if any recovered from the employee (Rs.) Amount of perquisite chargeable to tax Col(3) - Col(4) (Rs.) (1) (2) (3) (4) (5) 1 Accommodation 2 Cars/Other automotive 3 Sweeper, gardener, watchman or personal attendant 4 Gas, electricity, water 5 Interest free or concessional loans 6 Holiday expenses 7 Free or concessional travel 8 Free meals 9 .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... fficer, etc. in case of payment of TDS by Book Entry. 1. Procedure of preparation and furnishing Form 24G at TIN-Facilitation Centres (TIN-FCs): The Form 24G should be prepared by the PAO/DTO/CDDO (hereinafter referred to as AOs) as per the data structure (File format) prescribed by the DIT (Systems), Delhi which is available on TIN website www.tin-nsdl.com. The AOs can prepare Form 24G either by using in-house facilities, third party software or by using form 24G Return Preparation Utility (RPU) developed by NSDL e-Governance Infrastructure Limited (NSDL), which is freely downloadable from the TIN web-site www.tin-nsdl.com. After preparation of form 24G, the AO is required to validate the same by using the Form 24G File Validation Utility (FVU) which is freely available on TIN website. Once file is validated through FVU, '.fvu file' in CD/DVD/Pen Drive along with physical Statement Statistic Report (SSR) signed by the AO, to be furnished at TIN-FCs. On successful acceptance of Form 24G at the TIN-FC, an acknowledgement containing 15 digit Token no. is provided to the AO. The AO can view the status of Form 24G on TIN website. Book identification Numb .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... on of Form 24G accepted at TIN Central System. Preparation and validation of correction form 24G is in line with regular form 24G. The validated Form 24G correction file (.fvu file) can be uploaded online through AO account at TIN website. For correction Form 24G accepted at TIN central system, an online acknowledgement containing a 15 digit token number is generated and displayed to the AO. The format of the acknowledgement is identical to the one issued by the TIN-FC. There is no need to submit SSR and provisional receipt of original form 24G in online upload. 3. For FAQs and further details, AOs are advised to log on TIN website www.tin-nsdl.com ****** ANNEXURE IV Furnishing of Monthly Form No. 24G Statements by Pay and Accounts Officers (PAOs)/District Treasury Officers (DTOs)/Cheque Drawing and Disbursing Officers(CDDOs) 1. Under what income tax rule should Form 24G be filed? Income-tax Department Notification no. 41/2010 dated May 31, 2010 amended the Income Tax Rule 30 which mandates that in case of an office of the Government, where tax has been paid to the credit of Central Government without the production of a challan (associated with dep .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... ompound, SenapatiBapatMarg, Lower Parel, Mumbai - 400013 recommending allotment of AIN to the PAO / CDDO / DTO. 6. What information should be submitted through Form 24G? Every AO should furnish one complete, correct and consolidated Form 24G every month having details of each type of deduction / collection separately viz. TDS-Salary / TDS-Non Salary / TDS-Non Salary Non Residents / TCS made by each DDO under his jurisdiction. 7. Where should Form 24G be submitted? Form 24G is to be furnished only in electronic form in a CD/pen drive at TIN-FCs or online through AO Account at www.tin-nsdl.com web portal. The facility to submit Form No. 24G online is available free of cost. Provisional Receipt Number (PRN) is issued as an acknowledgement of the receipt of Form 24G. 8. How to register for online facility? Registration for AO Account is mandatory for filing Form No. 24G online through TIN website, www.tin-nsdl.com. Registration AO Account is required once only. AO required to submit the Form No. 24G at TIN-FC at least once to comply with the Know Your Customer (KYC) norms for registration of the AO Account. After registration, it is optional for AO either to .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... ith a unique Provisional Receipt Number (PRN) to the AO as a proof of submission of the statement. 14. What is Form 24G Preparation Utility? The Form 24G Preparation Utility is a Java based utility. Form 24G Preparation Utility can be freely downloaded from www.tin-nsdl.com. After downloading, it needs to be saved on the local disk of the machine. JRE (Java Run-time Environment) [versions: SUN JRE: 1.4.2_02 or 1.4.2_03 or 1.4.2_04 or IBM JRE: 1.4.1.0] should be installed on the computer where Form 24G Preparation Utility is being installed. JRE is freely downloadable from http://java.sun.com and http://www.ibm.com/developerworks/java/jdk or you can ask your computer vendor (hardware) to install the same for you. Form 24G Preparation Utility can be executed on Windows platform(s) Win 2K Prof. / Win 2K Server/ Win NT 4.0 Server/ Win XP Prof. To run the 'Form 24G Preparation Utility', click on the '24GRPU.bat' file. If JRE is not installed on the computer, then on clicking '24GRPU.bat', a message will be displayed. In such cases, install JRE and try again. If appropriate version of JRE is installed, then the 'Form 24G Preparation Uti .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... ccompanied with the Statement Statistic Report mentioned at Sr. No. (b), in paper form duly signed by the Accounts Officer, which needs to be submitted at TIN-FCs. Form 24G: Form 24G, at serial number (c) above, is a reader friendly format of TDS/TCS Book Adjustment form. This is like the physical form of Form 24G in html format. It contains all the details of Accounts Officer as well as Drawing and Disbursement Officer. There is no need to submit this file. 18. Can the Form 24G Statement be corrected? Every Form 24G is to be prepared in accordance with the data structure prescribed by the Income Tax Department (ITD). If it does not confirm to the new data structure it will be rejected by TIN. As per procedure, statements relating to Form 24G should be complete and correct. No fragmented statements are expected to be filed (i.e. separate statements giving details for deductions under different form type with respect to the same AIN, FY and month). However, any mistake made in an original accepted statement can be rectified by submitting a 'correction statement'. For correction, the latest version of the RPU should be downloaded from TIN website. Form 24G .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... mary key (AIN, Financial year and Month). This type of correction is to be filed only if the Form 24G has been filed with wrong AIN, F.Y. or Month. 22. What is BIN? BIN stands for Book Identification Number for each form type mentioned in the accepted monthly form No. 24G. BIN consists of the following: (i) Receipt Number: Receipt number is a seven digit unique number generated on successful acceptance of Form 24G. (ii) DDO Serial Number: It is a five digit unique number generated for every DDO transaction reported in Form 24G statement. (iii) Transfer Voucher Date: It is the last date of month for which Form 24G statement is filed. BIN is required to be disseminated to the respective DDOs who in turn are required to report the same in the TDS/TCS Statement. The quoting of BIN has been made mandatory w.e.f 01 st February, 2012. BIN is a unique number to verify the claim of TDS deposited without production of challan. As it is a verification key, it is advised that valid BIN disseminated by AO to the respective DDO should be correctly filled in TDS statement. 23. When is BIN generated? On processing of accepted Form 24G statement, BIN is generated .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... a particular month. 28. What are the duties of PAOs/DTOs/CDDOs? i. To apply for AIN with jurisdictional TDS office. AIN application can be downloaded from TIN site. ii. To obtain correct TAN from the reporting DDOs. iii. To file Form No. 24G (in CD, DVD, Pen Drive), within 10 days from the end of the month, electronically either at TIN-FC or by direct online upload at TIN website. iv. To track status of the filed Form No. 24G through TIN website. v. To download Book Identification Number (BIN) generated on the basis of 24G statement. vi. To disseminate BIN to the respective DDOs. 29. What are the duties of DDOs? i. To provide correct TAN to their PAOs/DTOs/CDDOs to whom the DDO/Deductor reports the tax so deducted who is responsible for crediting such sum to the credit of the Central Government. ii. To report to PAOs/DTOs/CDDOs, the details of tax deducted and credited to the Central Government account through book adjustment. iii. To quote BIN in the quarterly TDS/TCS Statement (24Q, 26Q, etc) for the tax deducted and credited through book adjustment. iv. Filing of TDS/TCS statement (24Q, 26Q etc) within the due date. v. To download .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... Pay Accounts Officer DTO District Treasury Office STO Sub Treasury Office DDO Drawing Disbursing Officer CDDO Cheque Drawing Disbursing Officer ANNEXURE VI POINT NO.4.9 OF DRAFT CIRCULAR OF DEDUCTION OF TAX AT SOURCE FROM SALARIES U/S 192 OF THE INCOME TAX ACT, 1961 - FINANCIAL YEAR 2015-16- PROCEDURE OF PREPARATION OF QUARTERLY STATEMENT OF DEDUCTION OF TAX UNDER SECTION 200(3) OF THE ACT 1. Quarterly e-TDS statement/return should be prepared by Deductor/DDO as per the data structure (File Format) prescribed by the DIT (Systems), Delhi which is available on TIN website www.tin-nsdl.com. Deductor/DDO can prepare e-TDS statement/return either by using in-house facilities, third party software or by using Return Preparation Utility (RPU) developed by NSDL e-Governance Infrastructure Limited (NSDL), which is freely downloadable from the TIN website. After preparation of e-TDS statement/return, the Deductor/DDO is required to validate the same by using the File Validatio .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... Y N Y N N Y Y N N For more information, deductors are advised to refer to e-tutorials/FAQs available on TRACES portal. Online correction entails no charges and does away with the requirement of downloading conso file and visiting TIN-FCs. 2.1.2 With effect from 1 st January, 2015, TRACES will be providing a correction window of 7 days from date of processing at CPC-TDS (generally 2 days after date of filing of statement). This facility will enable the filer to correct PAN errors and challan mismatch cases identified by CPC-TDS and avoiding of issuance of demand notices. Therefore, deductors are advised to check the processing status promptly so as to utilize this facility. 2.1.3 Deductor/DDO can also file a correction e-TDS statement for any modification in the e-TDS statement. Correction statement can be prepared by using the TDS Consolidated file that is available at TRACES (www.tdscpc.gov.in) . Validation of correction statement is in line with regular e-TDS statement, physical Form 27A duly signed and Statement St .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... d 8 digit receipt number is generated and displayed. There is no need to submit physical form 27A in online upload. Deductor/DDO can view the status of e-TDS statement/return on TIN website. No charges are applicable for online upload of e-TDS statement/return. 4.1 Correction of e-TDS statement/return online at TIN website: Deductor/DDO can file a correction e-TDS statement/return for any modification in e-TDS statement/return accepted at TIN central system. Correction statement/return can be prepared by using the TDS consolidated file only, available at the CPC-TDS portal www.tdscpc.gov.in through TAN registration. Preparation and validation of e-TDS statement is in line with regular e-TDS statement/return (submitted at TIN-FC) Deductor/DDO can login with its user ID and DSC and upload the validated e-TDS file (.fvu file) generated by the FVU to the TIN website. On successful acceptance of correction e-TDS statement/return at TIN, an acknowledgement containing a unique 15 digit token number is generated and displayed. There is no need to submit copy of provisional receipt of regular e-TDS statement/return, physical Form 27A and SSR in online upload. Deductor/DDO can .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... mp-sum of the remaining pension wealth, which he would be free to utilize in any manner. Individuals would have the flexibility to leave the pension system prior to age 60. However, in this case, the mandatory annuitisation would be 80% of the pension wealth. Architecture of the new Pension System (i) It will have a central record keeping and accounting (CRA) infrastructure, several pension fund managers (PFMs) to offer three categories of schemes viz. option A, B and C. (ii) The participating entities (PFMs and CRA) would give out easily understood information about past performance, so that the individual would be able to make informed choices about which scheme to choose. 2. The effective date for operationalization of the new pension system shall be form 1 st of January, 2004. U.K. SINHA, Jt. Secy. ANNEXURE-VIII MINISTRY OF FINANCE Department of Revenue (Central Board of Direct Taxes) Notification New Delhi, the 24 th November, 2000 INCOME- TAX S.O.1048 (E) - In exercise of the powers conferred by sub-clause (i) of clause (18) of Section 10 of the Income-tax Act, 1961 (43 of 1961), the Central Government, hereby specifi .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... -do- (Notification no. 1156/F.No. 142/29/99-TPL) T.K. SHAH Director ANNEXURE IX MINISTRY OF FINANCE Department of Revenue Central Board of Direct Taxes New Delhi,the 29 th January,2001 S.O.81(E)- In exercise of the powers conferred by sub-clause (i) of clause (18) of Section 10 of the Income -tax Act, 1961 (43 of 1961)), the Central Government, hereby specifies the gallantry awards for the purposes of the said Section and for that purpose makes the following amendment in the notification of the Government of India in the Ministry of Finance, Department of Revenue (Central Board of Direct Taxes) number S.O.1048(E), dated the 24 th November 2000, namely:- In the said notification, in the Table, against serial numbers 1,2 and 3 under column (3) relating to Circumstances for eligibility the words to civilians shall be omitted. (Notification No.22/F.No.142/29/99-TPL) T.K. SHAH Director ANNEXURE-X FORM NO. 10BA (See rule 11B) DECLARATION TO BE FILED BY THE ASSESSEE CLAIMING DEDUCTION U/S 80 GG I/We .. (Name of the assessee with permanent account number) .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

 

 

 

 

Quick Updates:Latest Updates