TDS Calculator

Calculate Tax Deducted at Source (TDS) on salary, interest, rent, and professional fees. Get accurate quarterly breakdown and know your net income.

Your TDS Summary

Important: TDS rates vary based on income type and whether PAN is provided. Without PAN, TDS is deducted at 20% or the applicable rate, whichever is higher (Section 206AA).

Income Distribution

What is TDS (Tax Deducted at Source)?

Tax Deducted at Source (TDS) is a system introduced by the Income Tax Department of India to collect tax at the very source of income. Under this mechanism, the person making a payment (deductor) is required to deduct a certain percentage of tax before making the payment to the recipient (deductee). This ensures that the government receives tax revenue throughout the year, rather than waiting for the end of the financial year.

TDS applies to various types of income including salary, interest from banks, rent payments, professional fees, commission, dividends, and lottery winnings. The deducted amount is then deposited with the government on behalf of the taxpayer, and the taxpayer can claim credit for the TDS while filing their income tax return.

Why is TDS Important?

TDS serves multiple purposes in the Indian tax system:

  • Prevents Tax Evasion: By collecting tax at the source, TDS reduces the possibility of taxpayers evading their tax obligations
  • Regular Revenue Flow: The government receives tax revenue continuously throughout the year, ensuring steady cash flow for public services
  • Reduces Compliance Burden: For salaried individuals, TDS simplifies tax compliance as their employer handles most of the tax deduction
  • Wide Tax Net: TDS brings various transactions under the tax net that might otherwise go unreported
  • Traceability: All TDS transactions are traceable through PAN, making the tax system more transparent

TDS Rates for Different Income Types (FY 2024-25)

The TDS rate depends on the nature of income and the applicable section of the Income Tax Act. Here are the key TDS rates:

Section 192 - TDS on Salary

TDS on salary is deducted based on the employee estimated annual income and applicable income tax slab rates. Employers calculate the total tax liability for the year and deduct TDS proportionately from each month salary.

Section 194A - TDS on Interest (other than securities)

Banks and financial institutions deduct TDS at 10% on interest payments exceeding Rs. 40,000 per year (Rs. 50,000 for senior citizens). This applies to FD interest, RD interest, and other bank deposits.

Section 194I - TDS on Rent

  • Rent on plant, machinery, or equipment: 2%
  • Rent on land, building, or furniture: 10%
  • Threshold: Rs. 2,40,000 per year

Section 194J - TDS on Professional/Technical Services

TDS at 10% is applicable on payments for professional services, technical services, royalty, and non-compete fees. The threshold limit is Rs. 30,000 per year.

Section 194H - TDS on Commission/Brokerage

TDS at 5% is deducted on commission or brokerage payments exceeding Rs. 15,000 per year.

Section 194 - TDS on Dividend

TDS at 10% is applicable on dividend payments exceeding Rs. 5,000 per year from domestic companies.

Section 194B - TDS on Lottery/Game Winnings

TDS at 30% is deducted on winnings from lottery, crossword puzzles, horse races, and other games of chance exceeding Rs. 10,000.

How to Calculate TDS?

The TDS calculation formula is straightforward:

TDS Amount = (Payment Amount x TDS Rate) / 100

For example, if you receive a professional fee of Rs. 50,000 and the TDS rate is 10%, the TDS deducted will be Rs. 5,000, and you will receive Rs. 45,000 as net payment.

TDS Without PAN (Section 206AA)

If the deductee (person receiving payment) does not provide their PAN to the deductor, TDS is deducted at a higher rate. According to Section 206AA, TDS will be deducted at:

  • The rate specified in the relevant provision of the Act, OR
  • At the rate of 20%, whichever is higher

This provision encourages taxpayers to quote their PAN in all financial transactions to avoid higher TDS deductions.

TDS Due Dates and Compliance

Deductors must deposit the TDS with the government within specified timelines:

  • Government Deductors: Same day (through book entry or challan)
  • Non-Government Deductors: Within 7 days from the end of the month (except March, where it is April 30)

TDS Return Filing Deadlines:

  • Q1 (April-June): July 31
  • Q2 (July-September): October 31
  • Q3 (October-December): January 31
  • Q4 (January-March): May 31

How to Claim TDS Refund?

If TDS deducted during the year exceeds your actual tax liability, you can claim a refund by filing your Income Tax Return (ITR). The refund process involves:

  1. Verify TDS deductions in Form 26AS (Annual Tax Statement)
  2. Calculate your total taxable income and actual tax liability
  3. File ITR mentioning TDS credits and claiming the refund
  4. The Income Tax Department processes the refund after verification

Form 15G and Form 15H

If your total income is below the basic exemption limit, you can submit Form 15G (for individuals below 60 years) or Form 15H (for senior citizens) to the deductor to avoid TDS deduction on interest income from banks.

Lower TDS Deduction Certificate

If you believe that your tax liability is lower than the TDS being deducted, you can apply for a Lower Deduction Certificate under Section 197. This allows the deductor to deduct TDS at a lower rate or NIL rate as specified in the certificate.

Common TDS Mistakes to Avoid

  • Not quoting PAN: Always provide your PAN to avoid 20% TDS
  • Ignoring Form 26AS: Regularly verify TDS credits in your tax statement
  • Missing refund claims: File ITR even if income is below taxable limit to claim TDS refund
  • Not submitting Form 15G/15H: Submit these forms at the beginning of the financial year to avoid unnecessary TDS

Frequently Asked Questions

What is the TDS threshold limit for salary?
There is no specific threshold for TDS on salary. TDS is deducted if the employee estimated annual income exceeds the basic exemption limit (Rs. 2.5 lakh for individuals below 60 years, Rs. 3 lakh for senior citizens). The rate is based on applicable income tax slab rates.
Can I avoid TDS on FD interest?
Yes, you can avoid TDS on FD interest if your total income is below the basic exemption limit. Submit Form 15G (if below 60 years) or Form 15H (if 60 years or above) to your bank at the beginning of the financial year. This declaration states that your total income is not taxable.
What happens if TDS is not deducted?
If the deductor fails to deduct TDS, they are liable to pay interest at 1% per month on the amount of TDS not deducted. Additionally, the deductee is still liable to pay tax on the income received. The deductor may also face penalties and prosecution for non-compliance.
How can I check my TDS details?
You can check your TDS details in Form 26AS (Annual Tax Statement) available on the Income Tax e-filing portal. This statement shows all TDS deducted against your PAN, including details of the deductor and the amount deducted. You can also check TDS credits in your Form 16 (for salary) or Form 16A (for other income).
What is the penalty for late TDS payment?
Late payment of TDS attracts interest at 1.5% per month or part of the month from the date of deduction to the date of actual payment. Additionally, late filing of TDS returns attracts a fee of Rs. 200 per day (up to the amount of TDS). Non-filing can result in a penalty ranging from Rs. 10,000 to Rs. 1,00,000.
Is TDS applicable on NRI payments?
Yes, TDS is applicable on payments to NRIs at rates specified under the Income Tax Act or the relevant Double Taxation Avoidance Agreement (DTAA), whichever is more beneficial. Common TDS rates for NRIs include 30% on short-term capital gains, 10% on long-term capital gains, and as per slab rates for salary income.

Related Calculators

💼 Income Tax Calculator 🧮 HRA Exemption Calculator 🏛️ FD Calculator 🧮 Gratuity Calculator