TDS stands for Tax Deducted at Source. It is a system introduced by the Income Tax Department of India to collect taxes directly from the income source. TDS means that tax is deducted when you earn income, such as salary, interest, or rent. Employers, banks, and companies deduct TDS and pay it to the government, ensuring a steady revenue flow and reducing tax evasion. You receive a TDS certificate, called Form 16, from your employer, detailing the income earned and TDS deducted. This helps you accurately file your income tax return.
TDS Full Form: TDS stands for Tax Deducted at Source, a system introduced by the Income Tax Department of India
Meaning of TDS: TDS means taxes are deducted directly from your income at the source, be it salary, interest, or rent
TDS Process: Employers deduct TDS from your salary before it reaches your account, ensuring regular tax payments
Purpose of TDS: TDS helps maintain a steady revenue flow for the government and reduces tax evasion
Entities Deducting TDS: Employers, banks, and companies deduct TDS from salaries, bank interests, and rents
Bank TDS Deduction: Banks deduct TDS from interest earned on fixed deposits
TDS Certificate: Form 16 is the certificate provided by employers showing total income and TDS deducted
Using TDS Information: Use Form 16 while filing income tax returns to ensure the correct amount of tax is paid