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Based on the total salary you'd earn at the new company in the remaining months of the fiscal year
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Normally tax was calculated based on june to may of a fiscal year. And there is tax slabs, let say a person lie in tax slab 3, (3. Where the taxable income exceeds Rs, 500,000 but does not exceed Rs, 750,000) His tax will be Rs, 2,000+5% of the amount exceeding Rs, 500,000 Let say his annual salary is 750000 (Monthly 62500) and his annual tax will be 14500 according to tax slab 3. Now if he joined a company at mid of January then what will be the tax deducted and on what formulla?
Umer Qadir Based on Total salary of remaining months, what tax slab will be used?
For the above formula the annual salary will be equal to the projected amount of your earnings at the new company in the fiscal year Eg. You join in Jan at 100k then. Your tax is deducted at the 600k slab and not 1200k slab
The company is only liable to deduct tax as per above formula but you are liable to pay for your entire earnings in the fiscal year...in this case you have to pay your deficit taxable amount directly to the Gov account
Umer Qadir "You join in Jan at 100k then. Your tax is deducted at the 600k slab and not 1200k slab" So You are saying its for Jan-June not Jan-May because fiscal year is always JUNE-MAY so basically there are 5 months not 6 and 100K should be 500K projected but not 600K? Please correct me on this. Then monthly tax will be equal to 2 months? because if projected earning as you suggested is 600K then its for 6 months and salary slabs are for 12 months or annual. so 600K ideally has to be dived by 12 and then tax amount should be equally divided on 5 or 6 months?
Mubasher Usman fiscal year is from July to June. So in the above example the months are six. For tax deduction at source Annual salary is what you earn with the employer in that fiscal year so your employer calculates the total amount you'd earn with them in the fiscal year in the above case 6 months of 100k which is a total of 600k taxable. The tax rate is applied for this number.
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The best thing is to consult your Finance department they'd give you the exact sheet of how they are deducting your tax
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Yar ma finance department say pocha ha unhoon ni satisfy answer nahi diya. Matlab bas bata diya k itna ha bas . Kesy ha ye ni bataya. Isi leye yahan forum pe pocha ha k koye Allah ka banda accounts and taxation janta ho tu samjha dy
Mubasher Usman Umer Qadir has given enough information. Fiscal year starts in July and ends in June. You are liable to pay tax on your annual income, but company will deduct the tax for the duration you have worked for the company. If you join in January they will deduct tax for six months at the source of six months salary,rest of the tax should be paid by you.
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