How to Legally Avoid TDS Deduction on Your Earnings
Learn effective strategies to skip TDS deduction legally and optimize your tax savings with expert tips.
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Avoiding TDS deduction legally involves ensuring your income doesn't qualify for TDS. Submit Form 15G or 15H if your total income is below the taxable limit. Invest in tax-saving instruments like PPF or ELSS to reduce taxable income. Stay updated on exemptions and deductions under the Income Tax Act. Always consult a tax advisor to optimize your tax-saving strategies and ensure compliance with laws.
FAQs & Answers
- What is TDS deduction? TDS (Tax Deducted at Source) is a tax collection mechanism where taxes are deducted at the source of income, such as salary, interest payments, or rental income, before the income is paid to the recipient.
- How can I legally avoid TDS deduction? You can legally avoid TDS deduction by ensuring that your total income is below the taxable limit, submitting Form 15G or 15H, and investing in tax-saving instruments to reduce your taxable income.
- What are Forms 15G and 15H? Form 15G is for individuals below the taxable limit to ensure no TDS is deducted on interest income. Form 15H is similar but is specifically for senior citizens.
- What are some tax-saving instruments I can invest in? Tax-saving instruments include Public Provident Fund (PPF), Equity-Linked Saving Schemes (ELSS), and other eligible investments that qualify for tax deductions under the Income Tax Act.