POSTED BY July 5, 2012 7:05 pm COMMENTS (3)ON
I have a question regarding the income tax calculations. Like we know, upto 2 lakhs is tax free for everyone now. But when company calculate TDS they charge you on the entire salary. They do not deduct the 2 lakhs before calculating your tax. For example if an individual draws a salary of 7 lakhs, they deduct the HRA, Conveyance, your investment of upto 1 lakhs and then calculate the tax. Shouldn’t they also deduct 2 lakhs from the remaining amount after all the other deductions? Because as per my understanding the 2 lakhs is tax free for all.
Let me know if I am wrong.
Thanks and looking forward to your reply.