As per the Income Tax Act, the TDS (Tax Deducted at Source) on salary should be deducted at the rates prescribed by the Income Tax department.
However, at times, companies would want to deduct TDS at a certain rate for their internal business reason.
Below are the steps on how to configure and deduct tax at a specific rate.
- Navigate to Control Panel > Payroll > Salary Templates
- Edit one of the Salary templates under which you would want to change the rate
- In the Deductions Components, create a new component - TDS 10, as shown in the screenshot below. The value should be 10% of Total Earnings.
- Save the template and assign it to the employee
Disclaimer: Income Tax on salaries should be as per the percentages defined by the Income Tax Department. Since you are overriding the same, we would strongly recommend you take a legal and professional opinion on the same.
We do not recommend overriding the Tax component. We strongly advice on using the Income Tax component for Indian payroll.