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Ravindra K. Banthia (None)     28 March 2014

Ambiguity in interpretation of rebate/relief rs. 2000 as per

Sorry if this post is akin to one already answered. I need an answer fast, or the wrong amount might get deducted as TDS this month.


I am a salaried professional (in a college).


My gross income =  4,89,364


Total Deduction under 80c etc = 79,298


Net Income =  4,10,066


STD Deduction = 2,00,000


Taxable Income = 2,10,066


Final Tax @ 10 % with 3% cess = 21,637


My employer (the college) insists on collecting this whole amount from me.


I wish to know whether the rebate/relief Rs. 2000 as per Section 87A has to be given by me as TDS?


My employer insists that the above rebate of Rs. 2000 can only be obtained by me as a refund when I file my income Tax return.


Another quick one: Is the tax calculation of a salaried person based on Gross Income or Net Income as far as the slab is concerned?


So if my Gross Income is Rs 5,00,001 but my Net Income after allowing for deductions under 80c etc is Rs 4,00,001, which slab do I belong to?


ii. Where the total income exceeds Rs. 2,00,000/- but does not exceed Rs. 5,00,000/-.

iii. Where the total income exceeds Rs. 5,00,000/- but does not exceed Rs. 10,00,000/-.


Thank you.


 4 Replies

Rama chary Rachakonda (Secunderabad/Telangana state Highcourt practice watsapp no.9989324294 )     29 March 2014

Taxes always on net income only after deductions. Slabs on net income only. You can see tax calculator in incometaxindia.

1 Like

T. Kalaiselvan, Advocate (Advocate)     29 March 2014

You will be falling under the slab of Where the total income exceeds Rs. 2,00,000/- but does not exceed Rs. 5,00,000/-.. If your employe is not giving the relief for Rs. 2000/- under section 87A, however, please note that 87A. Rebate on educational expenses in certain cases.-Omitted by the Finance (No. 2) Act, 1967, with effect from 1-4-1968. It was inserted by the Finance Act, 1964, with effect from 1-4-1964.  See what is your condition.

1 Like

sreekanth (Assistant Manager- Taxation)     02 April 2014

Your employer Calculation is Wrong.

Though you are entitled to Rs.2,000 tax credit , he did not give you

Actual tax should be 19,577 (including education cess of 3%)

Use the Tax calculator

You should Enter Taxable Income (i.e after deducting 80C) I.e 410,066


1 Like

Ravindra K. Banthia (None)     04 April 2014

Thank you very much, every one.

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