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.
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