What is TDS and when is it deducted?

TDS (Tax Deducted at Source) is tax withheld at the time of payment by the payer. The payer (deductor) deducts a percentage from the payment and deposits it with the government on behalf of the payee. TDS must be deducted when payment exceeds the applicable threshold and deposited by the 7th of the following month.

What is the TDS deposit due date in India?

TDS must be deposited within 7 days from the end of the month of deduction. Exception: For March, the due date is 30 April. If TDS is not deposited on time, interest of 1.5% per month (Section 201(1A)) is charged from the date of deduction to the date of deposit.

What happens if PAN is not furnished to the TDS deductor?

Under Section 206AA, if PAN is not furnished, TDS is deducted at twice the applicable rate or 20%, whichever is higher. For example, 194A interest normally at 10% becomes 20% without PAN. The deductee cannot claim credit easily without linking PAN. Always provide PAN to avoid excess deduction.

How do I claim TDS credit in my ITR?

TDS credit is claimed in your Income Tax Return under Schedule TDS. The deducted TDS is reflected in Form 26AS (Income Tax portal) and your AIS (Annual Information Statement). Ensure your deductor files the correct TDS return (Form 26Q, 27Q) to reflect your TDS. Claim it as advance tax paid in your ITR.

What is Form 16 and Form 16A?

Form 16 is a TDS certificate issued by employers for TDS deducted on salary. It shows complete salary details, deductions, and tax computation. Form 16A is issued for TDS on non-salary payments (contractor, professional fees, rent, etc.). Both are issued by the deductor quarterly/annually and are required to file your ITR.

What is the penalty for late filing of TDS return?

Under Section 234E, a late filing fee of ₹200 per day is charged for delayed TDS return (Form 26Q, 27Q). Under Section 271H, a penalty of ₹10,000 to ₹1,00,000 may be imposed. Additionally, interest under Section 201(1A) at 1.5% per month applies on late TDS deposits. Always file TDS returns by the 31st of the month following the quarter end.

TDS Calculator India 2026 — Tax Deduction at Source Free

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TDS Calculator — Tax Deducted at Source

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TDS Sections & Rates Reference 2026

Section	Payment Type	Rate	Threshold
192	Salary	Per IT slab	Basic exemption limit
194	Dividend	10%	No threshold
194A	Interest (Bank/PO)	10%	₹40,000 (₹50K senior)
194B	Lottery / Winnings	30%	₹10,000
194C	Contractor (Individual)	1%	₹30K / ₹1L aggregate
194C	Contractor (Others)	2%	₹30K / ₹1L aggregate
194D	Insurance Commission	5%	₹15,000
194H	Commission / Brokerage	5%	₹15,000
194I(a)	Rent (Plant/Machinery)	2%	₹2,40,000
194I(b)	Rent (Land/Building)	10%	₹2,40,000
194J	Professional Fees	10%	₹30,000
194J	Technical Fees	2%	₹30,000
194Q	Purchase of Goods	0.1%	₹50L (buyer turnover >₹10Cr)
194R	Perquisites / Benefits	10%	₹20,000
195	Non-resident Payment	20–30%	No threshold

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Frequently Asked Questions

What is TDS and when must it be deducted?+

TDS (Tax Deducted at Source) is tax withheld at the time of payment. The payer deducts a percentage and deposits it to the government. It must be deducted when the payment exceeds the applicable threshold limit for that section. TDS must be deposited by the 7th of the following month.

What is the TDS due date for deposit?+

TDS must be deposited by the 7th of the month following deduction. Exception: For March deductions, the due date is 30 April. Late deposit attracts interest at 1.5% per month under Section 201(1A). Always deposit TDS on time to avoid compounding interest.

What if PAN is not furnished?+

Under Section 206AA, TDS is deducted at twice the applicable rate or 20%, whichever is higher. This applies if the payee has not furnished their PAN. The payee cannot easily get Form 26AS credit. Always collect PAN before making payments above the threshold.

How do I file TDS return and by when?+

TDS returns must be filed quarterly: Q1 (Apr–Jun) by July 31, Q2 (Jul–Sep) by October 31, Q3 (Oct–Dec) by January 31, Q4 (Jan–Mar) by May 31. Use Form 26Q for non-salary, Form 27Q for salary, Form 27EQ for TCS. Late filing fee: ₹200/day under Section 234E.

What is the difference between Form 16 and 16A?+

Form 16: Issued annually by employer for TDS on salary. Contains salary details, deductions, and tax computation. Form 16A: Issued quarterly for TDS on non-salary payments (contractor, professional fees, rent, interest). Both are required for the payee to claim TDS credit in their ITR via Form 26AS.

Can a payee apply for lower or nil TDS deduction?+

Yes. Under Section 197, a payee can apply to the Assessing Officer for a lower deduction certificate if their estimated tax liability is lower than the TDS that would be deducted. The certificate is issued for the financial year. For example, a business with losses can get a Nil TDS certificate.

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