Understanding TDS Deductions: How Much Will Be Deducted from Your Income?
Learn about Tax Deducted at Source (TDS) rates based on income and transaction types. Get expert insights today!
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The Tax Deducted at Source (TDS) percentage varies according to the nature of the transaction and the individual's income bracket. For most salaries, it’s 10% if PAN is provided; for other payments like contractual work, it can be 1% or higher. Consult the latest tax guidelines or a tax professional.
FAQs & Answers
- What is TDS and how does it work? TDS, or Tax Deducted at Source, is a means of collecting income tax in India under the Income Tax Act. It is deducted at the source of income by the payer before making payments to the payee.
- How do I determine my TDS rate? The TDS rate is determined by the nature of the transaction and the income bracket of the individual. For example, salaries typically have a TDS rate of 10% if a PAN is provided, while contractual payments may have rates starting from 1% or more.
- What should I do if TDS is deducted incorrectly? If TDS is deducted incorrectly, you should contact the deductor to rectify the error. You can also file a complaint with the income tax department if necessary.
- Can I claim TDS deducted on my income tax return? Yes, TDS deducted can be claimed as a credit while filing your income tax return, provided you have the necessary documentation like Form 16 or Form 16A.