TDS should be deducted at the average rate
TDS Deduction from Salary-
It is the liability of the employer to deduct tax at source from salary under section 192 of the Income Tax Act, 1961.
Tax must be deducted at the average rate calculated based on the rates applicable for the current financial year on the income from the estimated salary of the employee for the year.
As per section 192, the person responsible for making the payment of salary income must the payee a statement giving true and complete view details of the perquisite or benefit in lieu of salary provided to him and the value thereof.
How to calculate average TDS which must be deposited every month.
For example, if the Annual taxable income from Salary is INR 10,00,000/- then the tax on total salary including cess, according to the below slab becomes INR 62,400/- calculating the tax on monthly salary INR 83,333/- as per the average tax rate of (62,400/10,00,000*100) 6.24 percent, it becomes (83,333*6.24%) INR 5200/- That is, TDS must be deducted every month on this amount.
For the above example, we considered the below-mentioned slab for the FY 2023-24
| Income range in INR | Income tax rate |
| Upto 3,00,000 | Nil |
| 300,000 to 600,000 | 5% on income that exceeds INR 300,000 |
| 600,000 to 900,000 | 10% on income that exceeds INR 600,000 |
| 900,000 to 12,00,000 | 15% on income that exceeds INR 900,000 |
| 12,00,000 to 15,00,000 | 20% on income that exceeds INR 12,00,000 |
| Above 15,00,000 | 30% on income more than INR 15,00,000 |