: TDS i.e. Tax Deducted at Source, is a term with which every employee is well familiar. People are troubled by this TDS every month when they receive their salary. But, now the central government has changed the rules regarding this. With its help, there will be many changes in TDS deduction and companies will have to reduce its deduction. Under Income Tax law, if you are paying TDS or TCS elsewhere, then the company will not be able to deduct that money from your salary.
CBDT issued Form 12BAA: Central Board of Direct Taxes (CBDT) has now issued a new Form 12BAA for TDS. Under this, you will be able to provide information related to TDS and TCS to your company. According to the new rules, the company can deduct tax on an employee's salary only under Section 192 of the Income Tax Act. CBDT has issued this new form as per the announcement made in the budget. The employee will have to use this form. In this, he will be able to give information about FD (Fixed Deposit), Insurance Commission, Dividend of equity share and tax paid on purchase of car etc.
You will be able to give information about payments made elsewhere. Till now, companies deduct TDS according to the investments declared by the employee. Taxes paid elsewhere are not included in this. Now there will be a change in this system. By giving information about TCS and TDS payment, you will be able to reduce the deductions from your salary. With this, more cash will come to the employees every month and their income will increase. CBDT has released this new form from October 1.
The new form is similar to Form 12BB, now you will be able to feel relief by giving information about TCS and TDS payment elsewhere through 12BAA. This is similar to Form 12BB, through which the employee discloses his investments. The company deducts TDS from his salary only on the basis of Form 12BB. The company makes this deduction only on the basis of powers received from the Income Tax Act. The employee first chooses Old Tax Regime and New Tax Regime. After this he gives information about the investment.
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