TDS Calculator India 2026

TDS (Tax Deducted at Source) is income tax deducted at the source of income before payment. It is a method of collecting tax in advance. The payer deducts TDS and deposits it with the government. The payee gets credit for this TDS when filing ITR.

TDS on salary is deducted by employers based on estimated annual income and declared investments. No fixed rate — it depends on the employee's tax slab after deductions. The employer calculates and deducts TDS monthly from salary.

TDS @ 10% is deducted on FD interest if annual interest exceeds ₹40,000 (₹50,000 for senior citizens). Submit Form 15G (below 60) or 15H (senior citizen) if your total income is below taxable limit to avoid TDS deduction.

TDS on rent: 10% for land/building/furniture if annual rent exceeds ₹2.4 lakhs, 2% for plant and machinery. Individual/HUF payers need to deduct TDS on rent if liable for tax audit. Section 194IB: 5% TDS on rent exceeding ₹50K/month by individuals.

If TDS deducted exceeds your actual tax liability, file ITR (Income Tax Return) to claim a refund. The excess amount will be credited to your bank account. Ensure your TDS is visible in Form 26AS on the income tax portal before claiming.

The payer (deductor) faces a penalty of 1% per month under Section 201(1A) if TDS is not deducted, and 1.5% per month if TDS is deducted but not deposited. Prosecution may apply for serious defaults. Always ensure TDS compliance to avoid interest and penalties.