Employee may have other income apart from salary income like Interest Income on Savings and FD,Rental Income etc
If Employee provides detail of same to Company, Company will take this into account while calculating TDS
If details not provided to company, company will not take them into account while calculating TDS
At the time of filing ITR (Income tax Return),Company has to pay Income tax on it as shown below
Example 1
Suppose a person has Salary income of 30000 per month. He has also Interest Income of FD of 8000
What will be TDS deducted by company if
Case 1
He Informs Company about his Interest Income
Case 2
He does not Inform Company about his Interest Income
View answer
| Case | 1 | 2 |
| MONTHLY SALARY | 30000 | 30000 |
| ANNUAL SALARY | 360000 | 360000 |
| LESS STANDARD DEDUCTION | 40000 | 40000 |
| NET ANNUAL SALARY | 320000 | 320000 |
| ADD: | ||
| OTHER INCOME | 8000 | 0 |
| GROSS TOTAL INCOME | 328000 | 320000 |
| TAX | 3900 | 3500 |
| REBATE | 2500 | 2500 |
| NET TAX | 1400 | 1000 |
| CESS | 56 | 40 |
| TAX+ CESS | 1456 | 1040 |
| MONTHLY TDS | 121 | 87 |
| NET SALARY | 29879 | 29913 |
Example 1 continued
What is Income Tax payable by him at the time of filing ITR in both cases
View answer
Income Tax Computation
| Case | 1 | 2 |
| MONTHLY SALARY | 30000 | 30000 |
| ANNUAL SALARY | 360000 | 360000 |
| LESS STANDARD DEDUCTION | 40000 | 40000 |
| NET ANNUAL SALARY | 320000 | 320000 |
| ADD: | ||
| OTHER INCOME | 8000 | 8000 |
| GROSS TOTAL INCOME | 328000 | 328000 |
| TAX | 3900 | 3900 |
| REBATE | 2500 | 2500 |
| NET TAX | 1400 | 1400 |
| CESS | 56 | 56 |
| TAX+ CESS | 1456 | 1456 |
| LESS: ANNUAL TDS | 1452 | 1044 |
| NET TAX PAYBALE | 4 | 412 |
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