TDS Interest Calculator
TDS Interest Calculator – Every Employer who is paying salary to his employee which is more then maximum amount exempt from tax has to deduct TDS on such Salaries Under section 192 of the Income tax Act,1961.
In general sense, a direct tax is one imposed upon an individual person (juristic or natural) or property (i.e. real and personal property, livestock, crops, wages, etc.) as distinct from a tax imposed upon a transaction. In this sense, indirect taxes such as a sales tax or a value added tax (VAT) are imposed only if and when a taxable transaction occurs. People have the freedom to engage in or refrain from such transactions; whereas a direct tax (in the general sense) is imposed upon a person, typically in an unconditional manner, such as a poll-tax or head-tax, which is imposed on the basis of the person’s very life or existence, or a property tax which is imposed upon the owner by virtue of ownership, rather than commercial use. Some commentators have argued that “a direct tax is one that cannot be shifted by the taxpayer to someone else, whereas an indirect tax can be.
The unconditional, inexorable aspect of the direct tax was a paramount concern of people in the 18th century seeking to escape tyrannical forms of government and to safeguard individual liberty.
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How to deduct TDS
Consider the following before deducting TDS
- Residential status of the receiver – there are separate rates for Residents and Non-Residents
- Type of payment – rate to be applied also depends on whether you are paying salary or rent or to a sub-contractor.
- Whether PAN is available or not – The rates mentioned in the income tax act are applicable where PAN is provided by the receiver. iIf the receiver does not provide you a PAN, TDS has to be deducted at 20% or rates as per the type of payment, whichever is higher. In case of EPF withdrawal, if PAN is not mentioned TDS is deducted at maximum marginal rate, which is 34.608 (for financial year 2015-16).
- When the receiver has a certificate for lower or no deduction of TDS – if the receiver has a certificate from an Assessing Officer for lower or no deduction of TDS, a copy of the letter can be kept and TDS deducted according to it.
- Amount of payment to Non Resident – there are different rates for payment
- to a non-corporate payment is 1crore or less OR is more than 1 crore
- to a foreign company payment is Rs 1 crore or less OR more than Rs 1crore but less than 10 crores OR more than Rs 10 crores.
Download TDS Interest Calculator
TDS Interest Calculator
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