Tax · Withholding tax
TDS — Tax Deducted at Source
TDS is the government's pay-as-you-earn enforcement: payers (employers, banks, tenants > ₹50K rent, freelance clients) deduct tax BEFORE paying you and deposit it under your PAN. You can verify deductions in Form 26AS / AIS — and claim refund if over-deducted. Salary TDS is the most common (Section 192) but 50+ TDS sections exist.
Who needs this
Salaried (TDS u/s 192), freelancers (194J / 194O), property sellers (194-IA, 1% on > ₹50L), tenants (194-I, 10% on > ₹2.4L/year rent), and FD interest earners (194A, 10% above thresholds).
Key dates
- TDS deposit deadline (employer)7th of next month
- Form 16 / 16A issue dateBy Jun 15 (Form 16) / 15 days post-quarter (16A)
- TDS refund trackingCheck ITR portal — typically 30-90 days post-filing
Key decisions
- Q1
Why is TDS deducted at higher rate?
If your PAN is invalid / not linked to Aadhaar / not provided: TDS rate is 20% flat (or higher of section rate). Link PAN-Aadhaar at incometax.gov.in if you see this on your 26AS.
- Q2
Can I avoid TDS on FD interest?
Submit Form 15G (under 60) / 15H (60+) at the bank IF your total income is below the basic exemption limit. Bank stops deducting TDS for that FY. Tax liability still applies if you exceed limit later.
- Q3
Got TDS but no income?
File ITR — claim full TDS as refund. Refunds typically come within 30-90 days. Track via the e-filing portal. Section 244A pays 0.5%/month interest if refund delayed > 3 months.
- Q4
TDS on rent — when does it apply?
Tenant must deduct 10% TDS u/s 194-I if monthly rent > ₹50K (since FY 2024-25 — earlier ₹2.4L/yr). Pay via Form 26QC, file Form 16C to landlord. Penalty on tenant if missed.
CBDT rules + tax-act references
- Sec 192 (salary): TDS at slab rate per estimated annual income.
- Sec 194A (interest): 10% if FD interest > ₹40K (₹50K seniors). Form 15G/15H to avoid.
- Sec 194-I (rent): 10% if monthly rent > ₹50K (post Oct 2024).
- Sec 194-IA (property sale): 1% on consideration > ₹50L.
- Higher TDS (20%) if PAN-Aadhaar not linked or PAN invalid.
Calculators
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