TDS on Salary – Circular for FY 2017-18

TDS on Salary – Circular for FY 2017-18

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The Revenue Tax Division has issued the “TDS on Wage” round for FY 2017-18. You possibly can check out it here.

Please be sure that all duties (revenue tax deduction, funding proof scrutiny, and so on.) associated to wage TDS compliance in your group for FY 2017-18 are carried out as per the round.

Para three.6.1 within the round

Circumstances for Declare of Deduction of Curiosity on Borrowed Capital for Computation of Revenue From Home Property [Section 24(b)]:

Part 24(b) of the Act permits deduction from revenue from homes property on curiosity on borrowed capital as beneath:-

(i) the deduction is allowed solely in case of home property which is owned and is within the occupation of the worker for his personal residence. Nevertheless, whether it is truly not occupied by the worker in view of his place of the employment being at different place, his residence in that different place shouldn't be in a constructing belonging to him.

There appears to be some confusion on account of the textual content above. The above para appears to recommend that deduction of curiosity on housing mortgage is accessible solely within the case of home property which is owned by the worker (please see the phrases underlined by us within the above quote). Some query whether or not this implies curiosity deduction shouldn't be out there for let-out property in FY 2017-18.

Part 24(b) permits curiosity deduction for each self-occupied and let-out properties. Para three.6.1 has been poorly worded and therefore is deceptive. It must be famous that the identical para was there in previous wage TDS circulars too. Chances are you'll remember that in FY 2017-18, the federal government launched a restrict on the loss from home property which might be set-off towards quantities beneath different heads of revenue. See here for extra info. Para three.6.1, in mild of the set-off restrict, compounds the confusion.

Para three.6.1 ought to have clearly said that the textual content within the paragraph pertains solely to self-occupied property and doesn't confer with let-out property. It isn't straightforward for a lay individual to undergo sections 23, 24 and 71 of the Revenue Tax Act, in an effort to perceive the circumstances governing curiosity deduction on home property. Readers of the round can simply misunderstand the textual content in para three.6.1 and make errors in curiosity deduction computation.

The Revenue Tax Division ought to contemplate getting its circulars vetted by communication specialists previous to their launch.

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