What is TDS on Salary (Income Tax)?
ERPNext calculates Income Tax (TDS u/s 192) on employee salaries based on declared investments, regime selection, and applicable slabs for Indian payroll compliance.
Income Tax Calculation in ERPNext
ERPNext's salary slip calculates projected annual taxable income from the employee's salary structure. Employees declare tax-saving investments (80C, 80D, HRA exemption) in the Employee Tax Exemption Declaration. ERPNext distributes the net tax liability equally across remaining months.
New vs Old Tax Regime
ERPNext supports both the Old Tax Regime (with deductions) and the New Tax Regime (lower slab rates, no deductions). Employees choose their regime at the start of the financial year. ERPNext applies the correct slabs and computes TDS accordingly.
Infonoxe Technologies specialises in ERPNext implementation and custom software for Indian businesses.
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