What to do if My Employer Does Not Pay TDS?

There might be occasion where you receive your salary every month but you find out at the end of the year that your employer hasn’t been paying your income tax as TDS at all. Is paying tax on your earnings your responsibility and yours alone? Are you liable to be prosecuted? What can you do if such a situation arises?

TDS or tax deducted at source, as an idea, was introduced with the goal of making meeting working capital requirements of the government as well as giving the taxpayer the flexibility to break down her liabilities into bite-sized pieces. It also serves the need to shift the liability of payment to the person who is responsible for disbursing the source of income in the first place.

Tax at source is paid not only by employers but also by insurance companies, fund managers, brokers and even those living in rented accommodation paying Rupees 50,000 or more as rent every month. In the last case, the owner of the rented property is responsible for depositing the toll to the IT department.

It is compulsory by law for all employers to pay this amount at the point of transfer, usually by using Challan 281, at designated banks and branches. Nowadays, you can also pay TDS online at the official CBDT portal. This applies to all corporate assessees as well as those non-company entities (businesses or professionals) whose gross income in the previous year was less than Rupees 1 crore in the case of commercial firms or Rupees 50 lakh in the case of skilled or unskilled professionals.

The IT department assumes that the employer represents the taxpayer for purposes of tax at source and holds him responsible for the latter’s taxes. Very often, the process of filling forms and identifying accounting methods is tedious and complicated depending upon how big your firm is. In such instances it is recommended that you get in touch with a seasoned tax expert to file payments for you.

Should your employer fail to pay your taxes make sure you have the necessary salary slips and proofs of deduction and get in touch with your Assessing Officer as soon as you can.

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