TaxSaral
Section 392TDSwas Section 192 in IT Act 1961

TDS on Salary

Your employer deducts TDS from salary every month. The employer estimates your total annual income, applies the regime and deductions you declared, computes annual tax, and divides by 12. Form 16 is issued as the TDS certificate.

Who this applies to

All salaried employees whose annual income attracts tax — the employer deducts and deposits TDS on their behalf.

Key Points

  • You must declare your chosen regime (default or optional) and planned deductions (80C, 80D, HRA) to your employer each year.
  • If you don't declare investments, employer deducts TDS assuming no deductions — you then claim refund at filing.
  • If you switch jobs mid-year, submit Form 12B to the new employer to avoid TDS shortfall.
  • Form 16 Part A shows TDS deducted; Part B shows salary computation — essential for filing ITR.

Worked Example

1

Monthly TDS computation

Scenario

Kavya earns ₹10L annual salary. She declares ₹1L in 80C investments and pays ₹22K in health insurance premium (80D). She uses the optional regime. How much TDS does her employer deduct each month?

Calculation

Gross salary:            ₹10,00,000
Standard deduction:     – ₹50,000 (optional regime)
Section 123 (80C):      – ₹1,00,000 (declared)
Section 130 (80D):      – ₹22,000
Total income:            ₹8,28,000

Tax on ₹8,28,000 (old regime slabs):
  ₹0–2.5L: Nil
  ₹2.5L–5L: 5% × ₹2.5L = ₹12,500
  ₹5L–8.28L: 20% × ₹3.28L = ₹65,600
  Total: ₹78,100
  Add 4% cess: ₹81,224

Monthly TDS: ₹81,224 ÷ 12 ≈ ₹6,769/month

Result

Kavya's employer deducts ₹6,769 per month. If Kavya forgets to declare her 80C investments, employer would deduct based on ₹9,50,000 income (no 80C deduction) — a higher TDS. She would get a refund after filing, but cash flow suffers.

Related Sections

Section 392 / Form 12BMultiple Employers — Form 12B
Section 15Salaries — Charging Section
Section 17Standard Deduction from Salary

Still have questions about Section 392?

Our tax team can explain how this provision applies to your specific situation.

Ask our tax teamBrowse all sections

Section references are based on the Income Tax Act 2025 (Tax Year 2026-27). Examples are illustrative — verify with a Chartered Accountant before filing.