Income from “Salaries” is required to be computed on estimated basis at the beginning of each financial year, taking into account salaries or remuneration paid or allowed. Income tax payable on the basis of such estimated salary income should also be calculated. Necessary adjustment is required to be made to arrive at the net tax liability, after considering specific allowable deductions, rebates & relief. Such estimation of salary income and net tax liability may require revision periodically, depending upon change in income of the employee or investment made by him in the form of deposit, subscription or payment. Every month 1/12th of the net tax liability is required to be deducted.
For the purpose of computation of making payment of tax, tax liability is to be determined at the average of income tax computed on the basis of rates in force for the financial year, on the income chargeable under the head ‘Salaries’ including value of non-monetary perquisites for which employer has opted to pay the tax himself.
For the purpose of computation of making payment of tax, tax liability is to be determined at the average of income tax computed on the basis of rates in force for the financial year, on the income chargeable under the head ‘Salaries’ including value of non-monetary perquisites for which employer has opted to pay the tax himself.
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