TDS under section 192

[Rahul Bagaria]

If the employee leaves the company on 25th of March ( 2019 - 2020) and the F&F settlement is done in the next FY (2020 - 2021)....however the provision is made in FY 2019 - 2020 but the company is deducting tax at the time of releasing the employee F&F in the next FY ( 2020 - 2021)....the section says tax to be deducted at the time of payment , may be the tax rate can change as compared to previous FY....is the company position correct from section 192 prespective

AI Summary

Tax Deduction Timing Under Section 192 Clarified: Company Correctly Deducts Tax During Final Settlement in Next Fiscal Year. An individual inquired about the correctness of a company's tax deduction practice under Section 192 when an employee leaves on March 25, with the final settlement processed in the next fiscal year. The company made provisions in the original fiscal year but deducted tax during the settlement in the subsequent year, potentially at a different rate. A respondent confirmed that the company's approach aligns with Section 192, which mandates tax deduction at the time of payment.