The Central Board of Direct Taxes (CBDT) has released a circular regarding Tax Deduction at Source (TDS) and income tax deduction on salaries for the year 2021-22.
The Circular issued today contains the rates of deduction of Income-tax from the payment of income chargeable under the head “Salaries” during the financial year 2021-22 and explains certain related provisions of the Act and income-tax Rules, 1962. All the sections and rules referred to Income Tax Act, 1961 and Income Tax Rules, 1962 respectively unless otherwise specified.
Last year, a Circular No, 20/2020 dated 03.12.2020 was issued whereby the rates of deduction of income-tax from the payment of income under the head “Salaries” under Section 1)2 of the Income-tax Act, 1961 (hereinafter ‘the Act’), during the financial year 2020-21. were intimated.
As per section 192 (1) of the Act, any person responsible for paying any income chargeable under the head “Salaries” shall, at the time of payment. deduct income-tax on the amount payable at the average rate of income-tax computed on the basis of the rates in force for the financial year in which the payment is made, on the estimated income of the assessee under the head of Salary income for that financial year. The section also provides that a person responsible for paying any income chargeable under the head “Salaries” shall furnish to the person to whom such payment is made a statement giving correct and complete particulars of perquisites or profits in lieu of salary provided to him and the value thereof.
CIRCULAR NO: 04/2022
DATE: 15th March, 2022
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