TDS
Also called Tax deducted at source
Tax deducted at source: tax the payer cuts before paying you, such as a bank on your FD interest.
TDS is tax cut at the point of payment. Your employer does it on salary, and your bank does it on interest once it crosses a yearly limit. It’s an advance on your tax, not the final bill, so the real number is settled only when you file your return.
See how it works on deposits in TDS on FD interest.
For salary, rent, fees and how to claim excess TDS back, see TDS explained.
Questions people ask
What is TDS in simple words?
TDS means tax deducted at source. Instead of you paying tax later, the payer, such as your employer or your bank, cuts a slice before the money reaches you and deposits it with the government in your name.
Is TDS the final tax I pay?
Not always. TDS is an advance, worked out at a flat rate. Your actual tax depends on your total income for the year. If more was deducted than you owe, you get the extra back as a refund when you file your income tax return.
Where can I see the TDS deducted on my income?
In your Annual Information Statement on the income tax e-filing portal, incometax.gov.in. Check it before you file your return, so every rupee of TDS is counted.
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