To create the Income Tax Deduction Pay Head,
Go to Gateway of Tally > Payroll Info. > Pay Heads > Create
Enter Pay Head name in the Name field
Select Employees' Statutory Deduction as the Pay Head Type from the List of Pay Head Types.
Select Statutory Pay Type as Income Tax
Select Current Liabilities from the List of Groups in the Under field
By default, Affect Net Salary is set to Yes
By default, the Pay Head component name entered in the Name field will appear in the Pay Slip, if you want to change the default pay head component name then type required name in Name to appear in Payslip field
In the Calculation Type field is defaulted to As per Income Tax Slab
Select the appropriate Calculation Period from the List of Calculation Periods.
Note: To process salary weekly, fortnightly or daily along with TDS, day wise option should be selected as Calculation Period.
Press Enter to accept.
Note: Currently, the Income Tax Amount for the Employees needs to be calculated separately and entered while processing the payroll Voucher.
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