Hi, Kindly explain me how do you calculate TDS from Salary? What is TDS ?please tell me to calculate ? Why do you deduct? Lokesh
From India, Delhi
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9From India, Delhi
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Dear Lokesh,
I shall insert an Excel worksheet (but comparatively simple) for Income Tax Calculation on salary for the Financial Year 2010-11 (Assessment Year 2011-12). Prior to that, I wish to explain some details to get an idea to enter the inputs.
On gross salary, the following deductions are applicable:
1) Professional Tax
2) House Rent in excess of 1/10th of salary subject to ceiling equivalent to HRA
3) Interest on Housing loan subject to ceiling Rs. 1,50,000.
4) Refund on Housing loan, savings, tuition fee for 2 children, etc., altogether subject to ceiling Rs. 100,000.
5) In addition, savings on infrastructure bonds up to Rs. 20,000.
6) Other than the above one lakh, 15000 to 20000 towards mediclaim premium, 40000 to 60000 towards treatment of specified diseases like Motor Neuron disease, 75000 to 100,000 towards disability, etc., are also admissible for deduction.
Now, taxable income can be calculated as follows:
Gross salary - total deductions = Taxable income
Taxpayers can be categorized into 3 groups:
1) Non-Seniors - Male
2) Non-Seniors - Female
3) Senior Citizens (65 years old & above)
If the taxable income is Rs. 2,40,000, a Senior Citizen is fully exempted from paying tax. Non-Senior Female has to pay in excess of Rs. 1,90,000 & Non-Senior Male in excess of Rs. 1,60,000.
Beyond the above income, one has to pay 10% up to Rs. 5,00,000, 20% thereafter up to Rs. 8,00,000, and 30% in excess of Rs. 8,00,000. In addition, an education cess @ 3% will be charged on Total Tax.
I shall provide an example:
Gross income of a Non-Senior Male - Rs. 12,00,000
Deductions (actual): Professional Tax - 12000, Housing loan interest - 2,00,000, Total savings/deductions - 2,50,000, Savings on Infrastructure bond - 25,000, other deductions over 1,00,000 - 50,000.
Admissible total deductions (subject to ceiling limits) - 12000 + 150000 + 100000 + 20000 + 50000 = 332000
Taxable income, 1200000 - 332000 = 868000
For Non-Senior Male:
Rs. 1,60,000 is exempted.
For the next 340000 (500000-160000), 340000 x 10% = 34000 -(1)
For the next 300000 (800000-500000), 300000 x 20% = 60000 -(2)
For the next 68000 (868000-800000), 68000 x 30% = 20400 -(3)
Tax - (1) + (2) + (3) = 114400
Also, for Non-Senior Female Tax is 110400 (114400-3000) and for Senior Citizens Tax is 106400 (114400-8000)
Education Cess, 114400 * 3% = 3432.
Total Tax - Rs. 1,17,832
Please refer to the Excel Sheet. Enter gross salary and deductions/savings applicable in the green color column. Results will be shown in the yellow color. The red color is used for static data.
ABBAS.P.S,
Secretary,
ITI Employees' Association,
ITI Ltd, PALAKKAD - 678 623,
KERALA, INDIA.
Ph. +91 9447 467 667
From India, Bangalore
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I shall insert an Excel worksheet (but comparatively simple) for Income Tax Calculation on salary for the Financial Year 2010-11 (Assessment Year 2011-12). Prior to that, I wish to explain some details to get an idea to enter the inputs.
On gross salary, the following deductions are applicable:
1) Professional Tax
2) House Rent in excess of 1/10th of salary subject to ceiling equivalent to HRA
3) Interest on Housing loan subject to ceiling Rs. 1,50,000.
4) Refund on Housing loan, savings, tuition fee for 2 children, etc., altogether subject to ceiling Rs. 100,000.
5) In addition, savings on infrastructure bonds up to Rs. 20,000.
6) Other than the above one lakh, 15000 to 20000 towards mediclaim premium, 40000 to 60000 towards treatment of specified diseases like Motor Neuron disease, 75000 to 100,000 towards disability, etc., are also admissible for deduction.
Now, taxable income can be calculated as follows:
Gross salary - total deductions = Taxable income
Taxpayers can be categorized into 3 groups:
1) Non-Seniors - Male
2) Non-Seniors - Female
3) Senior Citizens (65 years old & above)
If the taxable income is Rs. 2,40,000, a Senior Citizen is fully exempted from paying tax. Non-Senior Female has to pay in excess of Rs. 1,90,000 & Non-Senior Male in excess of Rs. 1,60,000.
Beyond the above income, one has to pay 10% up to Rs. 5,00,000, 20% thereafter up to Rs. 8,00,000, and 30% in excess of Rs. 8,00,000. In addition, an education cess @ 3% will be charged on Total Tax.
I shall provide an example:
Gross income of a Non-Senior Male - Rs. 12,00,000
Deductions (actual): Professional Tax - 12000, Housing loan interest - 2,00,000, Total savings/deductions - 2,50,000, Savings on Infrastructure bond - 25,000, other deductions over 1,00,000 - 50,000.
Admissible total deductions (subject to ceiling limits) - 12000 + 150000 + 100000 + 20000 + 50000 = 332000
Taxable income, 1200000 - 332000 = 868000
For Non-Senior Male:
Rs. 1,60,000 is exempted.
For the next 340000 (500000-160000), 340000 x 10% = 34000 -(1)
For the next 300000 (800000-500000), 300000 x 20% = 60000 -(2)
For the next 68000 (868000-800000), 68000 x 30% = 20400 -(3)
Tax - (1) + (2) + (3) = 114400
Also, for Non-Senior Female Tax is 110400 (114400-3000) and for Senior Citizens Tax is 106400 (114400-8000)
Education Cess, 114400 * 3% = 3432.
Total Tax - Rs. 1,17,832
Please refer to the Excel Sheet. Enter gross salary and deductions/savings applicable in the green color column. Results will be shown in the yellow color. The red color is used for static data.
ABBAS.P.S,
Secretary,
ITI Employees' Association,
ITI Ltd, PALAKKAD - 678 623,
KERALA, INDIA.
Ph. +91 9447 467 667
From India, Bangalore
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I would wants to know the full form of TDS....Is it Tax Deductible at source...or Total Deductible Salary???? Please help!!!!
From United Kingdom, Edinburgh
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From United Kingdom, Edinburgh
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Dear All,
My company is into excavation work and earthwork contracting. We have drivers, helpers, operators, and supervisors whose salaries range from $9000 to $11500 per month. I am curious to know if education cess is applicable in this scenario. Could you please provide guidance on this matter and share insights specific to our industry?
Thank you.
From India, Thana
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My company is into excavation work and earthwork contracting. We have drivers, helpers, operators, and supervisors whose salaries range from $9000 to $11500 per month. I am curious to know if education cess is applicable in this scenario. Could you please provide guidance on this matter and share insights specific to our industry?
Thank you.
From India, Thana
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Kindly explain me how do you calculate TDS from Salary? What is TDS ?please tell me to calculate ? Why do you deduct? Lokesh
From India, Mumbai
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From India, Mumbai
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Dear Lokesh,
I shall insert an Excel worksheet (but comparatively simple) for Income Tax Calculation on salary for the Financial Year 2010-11 (Assessment Year 2011-12). Prior to that, I wish to explain some details to get an idea to enter the inputs.
On gross salary, the following deductions are applicable:
1) Professional Tax
2) House Rent in excess of 1/10th of salary subject to ceiling equivalent to HRA
3) Interest on Housing loan subject to ceiling Rs. 1,50,000.
4) Refund on Housing loan, savings, tuition fee for 2 children, etc., altogether subject to ceiling Rs. 100,000.
5) In addition, savings on infrastructure bonds up to Rs. 20,000.
6) Other than the above one lakh, 15000 to 20000 towards mediclaim premium, 40000 to 60000 towards treatment of specified diseases like Motor Neuron disease, 75000 to 100,000 towards disability, etc., are also admissible for deduction.
Now taxable income can be calculated as follows:
Gross salary - total deductions = Taxable income
Taxpayer can be categorized into 3 groups:
1) Non-Seniors - Male
2) Non-Seniors - Female
3) Senior Citizens (65 years old & above)
If the taxable income is Rs. 2,40,000, a Senior Citizen is fully exempted from paying tax. Non-Senior Female has to pay in excess of Rs. 1,90,000 & Non-Senior Male in excess of Rs. 1,60,000.
Beyond the above income, one has to pay 10% up to Rs. 5,00,000, 20% thereafter up to Rs. 8,00,000, and 30% in excess of Rs. 8,00,000. In addition, an education cess @ 3% will be charged on Total Tax.
I shall give an example:
Gross income of a Non-Senior Male - Rs. 12,00,000
Deductions (actual): Professional Tax - 12000, Housing loan interest - 2,00,000, Total savings/deductions - 2,50,000, Savings on Infrastructure bond - 25,000, other deductions over 1,00,000 - 50,000.
Admissible total deductions (subject to ceiling limits) - 12000+150000+100000+20000+50000 = 332000
Taxable income, 1200000 - 332000 = 868000
For Non-Senior Male:
Rs. 1,60,000 is exempted.
For the next 340000 (500000-160000), 340000 x 10% = 34000 -(1)
For the next 300000 (800000-500000), 300000 x 20% = 60000 -(2)
For the next 68000 (868000-800000), 68000 x 30% = 20400 -(3)
Tax - (1) + (2) + (3) = 114400
Also For Non-Senior Female Tax is, 114400 - 3000 = 110400
and Senior Citizens Tax is, 114400 - 8000 = 106400
Education Cess, 114400 * 3% = 3432.
Total Tax - Rs. 1,17,832
See Excel Sheet. Enter gross salary and deductions/savings applicable in the green color column. Results will be shown in the yellow color. The red color is used for static data.
Regards,
Nilesh Karjawkar
(Legal Compliance & Audit
Knight Frank (I) Pvt Ltd
From India, Mumbai
Acknowledge(2)Amend(0)
I shall insert an Excel worksheet (but comparatively simple) for Income Tax Calculation on salary for the Financial Year 2010-11 (Assessment Year 2011-12). Prior to that, I wish to explain some details to get an idea to enter the inputs.
On gross salary, the following deductions are applicable:
1) Professional Tax
2) House Rent in excess of 1/10th of salary subject to ceiling equivalent to HRA
3) Interest on Housing loan subject to ceiling Rs. 1,50,000.
4) Refund on Housing loan, savings, tuition fee for 2 children, etc., altogether subject to ceiling Rs. 100,000.
5) In addition, savings on infrastructure bonds up to Rs. 20,000.
6) Other than the above one lakh, 15000 to 20000 towards mediclaim premium, 40000 to 60000 towards treatment of specified diseases like Motor Neuron disease, 75000 to 100,000 towards disability, etc., are also admissible for deduction.
Now taxable income can be calculated as follows:
Gross salary - total deductions = Taxable income
Taxpayer can be categorized into 3 groups:
1) Non-Seniors - Male
2) Non-Seniors - Female
3) Senior Citizens (65 years old & above)
If the taxable income is Rs. 2,40,000, a Senior Citizen is fully exempted from paying tax. Non-Senior Female has to pay in excess of Rs. 1,90,000 & Non-Senior Male in excess of Rs. 1,60,000.
Beyond the above income, one has to pay 10% up to Rs. 5,00,000, 20% thereafter up to Rs. 8,00,000, and 30% in excess of Rs. 8,00,000. In addition, an education cess @ 3% will be charged on Total Tax.
I shall give an example:
Gross income of a Non-Senior Male - Rs. 12,00,000
Deductions (actual): Professional Tax - 12000, Housing loan interest - 2,00,000, Total savings/deductions - 2,50,000, Savings on Infrastructure bond - 25,000, other deductions over 1,00,000 - 50,000.
Admissible total deductions (subject to ceiling limits) - 12000+150000+100000+20000+50000 = 332000
Taxable income, 1200000 - 332000 = 868000
For Non-Senior Male:
Rs. 1,60,000 is exempted.
For the next 340000 (500000-160000), 340000 x 10% = 34000 -(1)
For the next 300000 (800000-500000), 300000 x 20% = 60000 -(2)
For the next 68000 (868000-800000), 68000 x 30% = 20400 -(3)
Tax - (1) + (2) + (3) = 114400
Also For Non-Senior Female Tax is, 114400 - 3000 = 110400
and Senior Citizens Tax is, 114400 - 8000 = 106400
Education Cess, 114400 * 3% = 3432.
Total Tax - Rs. 1,17,832
See Excel Sheet. Enter gross salary and deductions/savings applicable in the green color column. Results will be shown in the yellow color. The red color is used for static data.
Regards,
Nilesh Karjawkar
(Legal Compliance & Audit
Knight Frank (I) Pvt Ltd
From India, Mumbai
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Income Tax Calculation 2009-10 - Salaries.xls