Do you know about the meaning and full form of TDS in the Indian tax system? Tap to check out the complete information about TDS to boost your knowledge.
As per the Indian tax system, TDS is a direct taxation mechanism which involves collecting tax from the source of income or at the time of income payout.
As the official website of the Income Tax of India, TDS stands for Tax Deducted at Source. It is because the tax is collected from the income itself.
In TDS deduction process, the deductor (employer) which makes the the payment to deductee (employee) has to collect the tax from source and remit it to the Central government.
If the nature of payment is professional fees, the deduction will be 10%. So, if your salary is Rs 30,000, then a TDS deduction of Rs 3,000 will be collected from the source.
TDS is a taxation mechanism in which the deductee is not required to pay the whole taxable amount at the end. The amount is collected from the source.
The deductee whose tax has been deducted and remitted to the government is entitled to credit. He/she can claim it based on Form 26AS or the TDS certificate from the deductor.
For more such updates, stay tuned to the Daily Jagran!