CBDT Circular on Salary TDS for FY 2018-19 (AY 2019-20) u/s 192 of Income Tax

CBDT Circular on ‘Income Tax Deduction from Salary (i.e. TDS on Salary)’ u/s 192 of Income Tax Act, 1961 in respect of FY 2018-19 (AY 2019-20)

Income Tax Deptt./ CBDT has issued Circular No. 1/2019 dt. 1 Jan. 2019 containing instructions on the provisions/ TDS rates applicable in respect of salary payment u/s 192 during the Financial Year 2018-19 (Assessment Year 2019-20), including explanations on many other related issues/ provisions under the Income Tax Act/ Rules.

In this circular, provisions relating to re-introduction of Standard Deduction of Rs. 40,000 from Salary Income (in lieu of Transport Allowance and Medical Reimbursements), rates of income tax, surcharge, health and education cess (in lieu of secondary and higher education cess), etc. have been duly clarified for consideration during the process of calculation of TDS liability on salary.

It may be reiterated that the instructions contained in the aforesaid CBDT Circular on Salary TDS for FY 2018-19, are not exhaustive and are issued by the CBDT only with a view to guide the employers/ employees 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.

Salary TDS u/s 192 of Income Tax for FY 2018-19 (AY 2019-20): CBDT Circular 1/2019 Income Tax dt. 1 Jan. 2019

Index of Contents

CBDT Circular No. 1/ 2019 dt. 1 Jan. 2019 TDS on Salary

1. General

2. RATES OF INCOME-TAX AS PER FINANCE ACT, 2018

2.1 Rates of tax

2.2 Surcharge of Income tax

2.3.1 Health and Education Cess

3. BROAD SCHEME OF TAX DEDUCTION AT SOURCE FROM SALARIES

3.1 Method of Tax Calculation

3.2 Payment of Tax on Non monetary Perquisites by Employer

3.2.1 Computation of Average Income Tax

3.3 Salary From More Than One Employer

3.4 Relief When Salary Paid in Arrear or Advance

3.5 Information regarding Income under any Other head

3.6 Computation of Income under the head – Income from house property

3.7 Adjustment for Excess or Shortfall of Deduction

3.8 Salary Paid in Foreign Currency

4. PERSONS RESPONSIBLE FOR DEDUCTION OF TAX AND THEIR DUTIES

4.1 Stipulation of section 204 of the Act

4.2 Tax determined to be deducted from Salary u/s 192

4.3 Deduction of Tax at Lower Rate

4.4 Deposit of Tax Deducted

4.4.1 Due dates for payment of TDS

4.4.2 Mode of payment of TDS

4.5 Interest, Fee, Penalty& Prosecution for Failure to Deposit Tax Deducted

4.6 Furnishing of Certificate for Tax Deducted (Section 203)

4.7 Mandatory Quoting of PAN and TAN

4.8 Compulsory Requirement to furnish PAN by employee (Section 206AA)

4.9 Statement of Deduction of tax under of section 200 (3) [Quarterly Statement of TDS]

4.10 TDS on Income from Pension

4.11 Matters pertaining to the TDS made in case of Non Resident

5. COMPUTATION OF INCOME UNDER THE HEAD ―SALARIES

5.1 Income chargeable under the head ―Salaries

5.2 Definition of ―Salary‖, ―perquisite‖ and ―profit in lieu of salary (Section 17)

5.3 Income not included under the Head ―Salaries‖ (Exemptions)

5.4 Deduction u/s 16 of the Act form the Income from Salaries

5.5 Deductions under Chapter VI-A of the Act

6. REBATE OF RS. 2500 FOR INDIVIDUAL HAVING TOTAL INCOME UPTO RS. 3.5 LAKH (SECTION 87A)

7. TDS ON PAYMENT OF ACCUMULATED BALANCE UNDER RECOGNISED PROVIDENT FUND AND CONTRIBUTION FROM APPROVED SUPERANNUATION FUND

8. DDOS TO SATISFY THEMSELVES OF THE GENUINENESS OF CLAIM

9. CALCULATION OF INCOME-TAX TO BE DEDUCTED

10. MISCELLANEOUS

ANNEXURE 

I. SOME ILLUSTRATIONS

II. FORM NO 12BA

IIa. FORM NO 12BB

III. REVISED PROCEDURE FOR FURNISHING QTLY E-TDS/TCS STATEMENT BY DEDUCTORS/COLLECTORS

IV. THE PROCEDURE OF FURNISHING FORM 24G

V. PERSON RESPONSIBLE FOR FILING FORM 24G IN CASE OF STATE GOVT DEPARTMENTS/ CENTRAL GOVT DEPARTMENTS

VI. PROCEDURE OF PREPARATION OF QUARTERLY STATEMENT OF DEDUCTION OF TAX u/s 200(3)

VII. DEPTT. OF ECO. AFFAIRS NOTIFICATION DATED 22.12.2013

VIII. BOARD‘S NOTIFICATION DATED 24.11.2000

IX. BOARD‘S NOTIFICATION DATED 29.01.2001

X. FORM NO. 10BA

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