Tax Glossary Definition
Unpaid salary refers to salary or bonus that has been earned but not yet paid to the employee. Its taxability depends on the method of accounting used by the employer: under the cash system, it is taxed when received, while under the accrual system, it is taxed when credited or due.
Example: A bonus of ₹1 lakh due in March but paid in April is taxable in the year it is credited, if accrual accounting is followed
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