What is TDS Deduction

Tax Deducted at Source, or TDS, is the amount of income tax that is subtracted from the money that the individuals making certain payments, such as rent, commission, professional fees, salary, interest, etc., pay. Generally, income recipients are required to pay income taxes.

Everyone is expected to deduct tax at source, including individuals, businesses, HUFs (Hindu Undivided Families), and non-resident Indians (NRIs); nevertheless, you must deduct TDS on every payment made in accordance with the Income Tax Act of 1961’s provisions or under one of the five heads of income.

Before depositing the money in your account and submitting it to the government on your behalf, employers take taxes out of your pay. Tax Deduction at Source, or TDS, is the idea of withholding taxes prior to payment. The Income-tax Act of 1961’s Section 192 addresses TDS on salaries.

Every statutory deduction, including ESI, TDS, and EPF, is taken out when payroll is processed. After that, the business sends the money to the appropriate government organizations. The type of dues will determine the frequency. Payment of dues is typically made using challans.