Budget 2024: How TCS is set to become less TDS for salaried class

Individuals miffed at tax collection at source (TCS) proposals have now been offered a small relief - provided they have salary income.At present, a salaried employee may declare income, such as bank interest and rent, to their employer, who factors this and, accordingly, deducts a higher tax against the monthly salary. The employee then does not have to worry about paying advance tax as adequate tax has already been withheld.A similar norm comes into effect from Oct 1. The salaried employee will be able to declare TCS and the employer will factor this in, resulting in a lower TDS against salary income. Thus, it will avoid cash-flow issues. Further, if a refund was due, owing to TCS, the individual taxpayer will no longer have to wait for it as it is adjusted against TDS on salary income.TCS applies to a wide range of remittances made under Liberalised Remittance Scheme (LRS) of Reserve Bank of India. It permits an individual to remit up to $2.5 lakh per year, without seeking prior approval.Thus far, purchase of an overseas tour package pinched the pocket - it meant a 5% TCS for a remittance of up to Rs 7 lakh; if the expenditure was higher, TCS was 20%. Or for that matter, sending a child overseas meant that TCS at 5% was deducted for any remittance above Rs 7 lakh (the rate was lower for remittances via education loans).In short, the Budget has added a sweetener to TCS provisions for salaried individuals.