GPIND: Wrong TDS Calculation On Projected Salary With Arrears
(Doc ID 2700908.1)
Last updated on AUGUST 14, 2020
Applies to:PeopleSoft Enterprise HCM Global Payroll India - Version 9.2 and later
Information in this document applies to any platform.
If there is a retro compensation change then the retro arrears are added to the TDS PROJECT WAGES accumulator, then taxed. This is incorrect as the arrears should be considered in TDS NON PROJ WAGES and then be taxed(marginal tax) . Arrears would be a one-time component it would not be appropriate to consider this for TDS projection. If the arrears is paid towards the end of the Financial year say in Feb, the TDS projection would be high and hence tax deducted would be more. So the employee needs to go for tax refund.
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