Non Quoting of Aadhaar or PAN can lead to 20% TDS Deduction

Non Quoting of Aadhaar or PAN can lead to 20% TDS Deduction As per CBDT Circular Number 4/2020, dated 16.01.2020, CBDT has clarified that Employer will deduct 20% TDS in case of Non Quoting of Aadhaar or PAN details. This rule is applicable in case of employee whose salary is more than Exempted Slab. Section 206AA of Income Tax provides for deduction of TDS at rate of 20% or higher, in case of Non quoting or incorrect quoting of PAN Number. Also, No Lower Tax Deduction declaration is valid in case you dont have a PAN. As per the new circular, the non quoting of aadhaar or PAN can lead to Higher TDS Deduction. This is also a hint towards, government initiative towards linking of PAN and Aadhaar. So an employee if gives Aadhaar instead of PAN, that will also safeguard him from Higher TDS deduction. [caption id="attachment_86524" align="alignnone" width="835"] Non Quoting of Aadhaar or PAN can lead to 20% TDS Deduction[/caption] This can be summarised by below mentioned example: For Example if after making all deductions, the average tax rates, comes out less than 20%, then 20% TDS would be deducted. If the average rate is more than 20%, then the higher rate will be applicable. For Regular Professional Updates Join : https://t.me/Studycafe