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TallyPrime 5.0 automates TDS calculation under Section 194Q, ensuring compliance with Finance Bill 2021. Easily calculate TDS on transactions, manage threshold limit and exemptions, and file returns seamlessly.
https://help.tallysolutions.com/docs/te9rel53/Payroll/Income_Tax_Deduction_Pay_Head.htm

Creating Pay Head for Income Tax Deduction (Payroll)

To create the Income Tax Deduction Pay Head

  1. Go to Gateway of Tally > Payroll Info. > Pay Heads > Create.

The Pay head creation screen appears as shown below:

  1. Enter the pay head name in the Name field.

  2. Select Employees' Statutory Deduction as the Pay Head Type, from the List of Pay Head Types.

  3. Select Statutory Pay Type as Income Tax.

  4. Select Current Liabilities from the List of Groups in the Under field.

  5. By default, Affect Net Salary is set to Yes.

  6. By default, the pay head component name entered in the Name field appears in the pay slip. Enter the Name to appear in Payslip if you want to change the default pay head component name.

  7. The Calculation type is set to As per Income Tax Slab, by default.

  8. Select the appropriate Calculation period from the List of Calculation Periods.

Note: To process salary weekly, fortnightly or daily along with TDS, select the day wise option as Calculation Period.

  1. Press Enter to accept.

Note: Currently, you need to calculate the Income Tax Amount for the employees separately, and enter the same while processing the payroll voucher.

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