Employer can't deduct TDS u/s 192 on the notice period pay amount received from employee as employer not accounted any salary expenses nor paid any amount to employee. That is a reason this amount is treated as income in the hands of employer. Though TDS under section 192 needs to be deducted on estimated income of whole year, monthly deduction is always r propertinate to the monthly income. Currently there is no IT provision allow deduction while computing income of employee for notice period pay paid by employee. Govt, has to insert some new section to enable employee to claim the notice period pay expenses incurred by them while computing their annual tax liability provided that the same expenses not reimbursed by the new employer by way of joining bonus.
