TDS Question / If I am Liable to Pay TDS @5,000 P.M.?

[Guest]

Hi Raghavendra Varma,

My Employer plans to deduct ₹ 5000 (at 10%) on Total Profit + Base Salary. Please find the details below:

Company Balance:

225,000 + Taxes Client1 = 257,000

250,000 All inclusive Client2

40,000 + taxes Client3 = 44,000

Total :- 551,000

Company Deductions for Profit Sharing:

TDS 10% : 55,000

Service Tax 14% : 77,000 (Approx)

Cess : 2750 (Approx)

Me (Base Salary: 40,000

Gagan : 45,000

Vishwesh : 28,000

Rakesh : 30,000

Ritesh : 80,000

New Laptop for Shailesh : 50,000 (Approx)

Server : 10,000

Mainak : 25,000 (Approx, to be decided)

Misc Expenses 8,000

Balance Profits : 100,000

My 10% Share = 10,000

Total Payable to Me = 50,000 (Base Salary + 10% of Profit)

Now over this balance as well, my employer asks:

1. The company shall deduct 10% of 50, 000
2. The company shall deduct PT

Which basically means I would get Balance Amount - TDS + PT = Actual Revenue per month = 50, 000 - (5000 + 200) = 44, 800 INR

My Question is:

1. On Profits, Company TDS was already calculated, 10% of overall should be again calculated?
   
2. Which ITR form return should I e-fill?

Kindly let me know the details.

[Ganeshan Kalyani]

Sir, the salary paid by the company is accounted in the debit side of the P&L which means company is getting deduction of the expense and net amount is offered for Corporate Tax. Since salary is not taxed in the hands of company it is taxable in the hands of employee. Thanks.

[Guest]

Thanks for the prompt reply. I've two generic questions to be answered here without going much deeper into this.

1. Which ITR should I file return against? ITR4 or ITR4S or shall it be ITR1?
2. What returns should I expect assuming that my:
   • Base Salary = ₹ 40, 000
   • No Deductions
   • Profits: ₹ 10, 000
   • Overall Balance is TDS deductable

Kindly let me know these specific details.

[Ganeshan Kalyani]

Sir do you have income from house property also. Do you have income from other source also. These will determine which form you should be selecting for filing of return. Thanks.

[Guest]

Hi,

No, I do not have any other sources of income or income from home rent, etc. I haven't invested in any NSC or Gramin Scheme as well to save taxation. I'd therefore like to know the tax liable to me over ₹ 50, 000 P.M with:

1. TDS deduction @ 10% of overall
2. ITR form which I need to fill
3. Whether Return would get back my TDS deducted

Thanks for the prompt revert on this one.

[Ganeshan Kalyani]

In my view it is ITR 4.

[Guest]

Thanks a lot, but I don't see e-filling has this form? and whether Return would get back my TDS deducted?

[Ganeshan Kalyani]

Please visit www.incometax.gov.in.

AI Summary

Salary and profit share taxation: employer may deduct TDS; file appropriate ITR to claim any refund entitlement. Salary and profit share payments to an employee are taxable in the employee's hands and may be subject to Tax Deducted at Source by the employer. Selection of the appropriate income tax return form depends on the composition of the employee's total income; the taxpayer may file a return to reconcile actual liability and claim refund of any excess TDS withheld. Procedural details on e filing and form availability should be checked with the tax authority's official resources.