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TDS
Tax Deducted at Source
Tax withheld by the payer and deposited with the government on your behalf.
Detailed explanation
Employers, banks and other payers deduct TDS before paying you and report it against your PAN. The amount appears in Form 26AS and the Annual Information Statement, and it is adjusted against your final tax liability when you file — any excess comes back as a refund.
Example
₹80,000 of FD interest with 10% TDS means the bank pays ₹72,000 and deposits ₹8,000 against your PAN.
Why it matters
TDS is not the final tax. If your slab is lower, you claim a refund; if higher, you still owe the balance.
Key points
- Always reconcile Form 26AS/AIS before filing.
- Form 15G/15H can prevent deduction where income is below the threshold.
- A missing PAN triggers a much higher deduction rate.
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Educational content only. Definitions and examples are illustrative and are not investment, tax or legal advice.