TaxTMI 
TaxTMI 
Employers to take declarations in April 2023 from employees whether they wish to enter New Scheme/Old Scheme
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....mployers to take declarations in April 2023 from employees whether they wish to enter New Scheme/Old Scheme<br>By: - Vivek Jalan<br>Income Tax<br>Dated:- 20-4-2023<br><br>The employees should opt for new scheme or old scheme of taxation. Now its action time for employers who have to start deduction TDS when they make payments to employees in the April 2023 and thereafter. CBDT's Circular 04 has ca....
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....st a liability on the employer, as always, to obtain a declaration from employees on the computation of their income for the FY 2023-24 to estimate the monthly TDS amount. Once, the employer asks, then its duty is over, and it is the employee's duty to declare whether for FY 2023-24 he/she wishes to go into the new scheme or old scheme. In case he/she wishes to go with the old scheme, then he/she ....
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....would have to declare the amount which he/she wishes to claim as deductions like that for HRA /80C/ 80D/ etc. The further issues as well as their answers are as follows - A. In case the employee does not declare anything, then what do employers do? The answer is that the employers have to assume that employee wishes to go with the new scheme and apply TDS as such. It is to be noted that the new s....
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....cheme is now the "default" scheme. B. At the end of the year, when filing the return, the employee can switch to the old scheme also and compute its tax liability accordingly. It is to be noted that employees can enter and exit in the two schemes every year. C. A theoretical question may be asked i.e., in case the employers apply TDS according to the new scheme and the employee files the return ....
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....under the old scheme and finally the tax liability under the old scheme is more than the new scheme, would the employer be liable in that case? While as said, this question is not practically possible, but even hypothetically we do not feel that there would be any liability of the employer in this scenario.<br> Scholarly articles for knowledge sharing by authors, experts, professionals ....