As you all know it is employer duty to deduct TDS for the payment of salary to employees. So U/s 192, the employer is required to deduct income-tax while making the payment of salary during the financial year 2015-16 at the rate of income tax slab for A.Y.2016-17.
Employees who are getting salary from employer should submit their losses and other deductions details to employers for the purpose of TDS.
Suppose you have loss from house property income, it is adjustable in the income from salary while calculation of TDS.
An employee may furnish a statement, duly verified giving details of his other income or loss under the head ‘house property’ to his employer who shall deduct out of salary payment the tax due on total income after allowing set off of loss from house property subjects to certain conditions.
Tax on salary due or received from other employer can also be deducted for which the particulars should be furnished in Form 12B.
A Govt. employee and employee of a company, co-operative society etc. may get relief under section 89(1) viz. where more than 12 months’ salary is received in any year or where the terminal benefits taxable in lieu of salary are received.
For this purpose, the employee should furnish requisite particulars of arrears/advance salary, gratuity, and termination compensation or commuted pension, in From No.10E, to his employer. For calculation of relief under section 89(1) please refer to ‘Relief on Salary Arrears/Advance, Gratuity, Pension, etc.’ discussed earlier.
It may be noted that an employee cannot claim set off in respect of any other loss (except loss from house property), against his salary income for the purpose of TDS. For this purpose, he should file a return, claiming set off and obtain refund due, if any.
TDS on Pension
It has been clarified that ‘salary’ includes ‘pension’ and TDS shall be deductible on pension disbursed banks and TDS certificate issued in Form No. 16 accordingly. However, no TDS is to be deducted on disability pension to ex-servicemen.