TDS Calculator

What is Tax Deducted at Source (TDS)?

TDS stands for Tax Deducted at Source. It refers to the tax amount an employer deducts from a taxpayer’s income and deposits with the Income Tax Department on their behalf. 

It is a certain percentage of an individual’s monthly income, deducted at the time of payment. Every individual and organization is liable to pay taxes if their income exceeds a certain threshold, as per the Income Tax Act 1961.

How to Calculate TDS Amount on Salary?

The formula for the TDS calculation for salary is as follows:

Average Income Tax Rate = Income Tax Payable (computed with slab rates) / Estimated income for the financial year.

Here’s an example to explain how the formula for TDS calculation works.

Suppose an employee named Ms. Ramya's annual pay is Rs. 1,00,000. Please be aware that these rates vary every year and are governed by the tax rules of the relevant financial year):

• In accordance with Section 192 of the Income Tax Act, the TDS on her total salary is Rs. 1,42,500, which is based on the tax slabs for the current year.

• Her total payable tax is Rs. 1,48,200 after deducting the 4% education and higher education cess.

Now, to calculate the avg TDS rate applicable for Ms. Ramya, we must divide the total payable tax by the annual pay and then multiply it by 100:

Average TDS Rate = (1,48,200 / 12,00,000) × 100 = 12.35%

This means, each month, the TDS that will be deducted from Ms. Ramya's salary is 12.35% of Rs. 1,00,000, which equals Rs. 12,350. Therefore, Ms. Ramya will have an amount of Rs. 12,350 deducted from her salary each month in the form of Tax Deducted at Source.

What is TDS Calculator?

The salary TDS calculator is an online tool that allows individuals to determine how much tax amount will be deducted from their salary, and find out their in-hand salary after deduction. It allows you to calculate the amount of tax deducted at source as per the Income Tax Act 1961.

How to use Registrationwala’s TDS Calculator?

Registrationwala’s Tax Deducted at Source (TDS) calculator is an easy-to-use online tool. To use it, follow these steps:

Step 1: Choose Recipient from (i) Individual (ii) Hindu Undivided Family (iii) Sole Proprietorship and (iv) Others.

Step 2: Now, click on the checkbox if the deductee's PAN is not available. (The TDS rate varies depending on whether the deductee has a PAN or not.)

Step 3: Now, choose the section under which your income falls. 

Step 4: Finally, enter the Payment Amount. 

After entering all the required information, our TDS calculating tool will reflect the amount of Tax Deducted at Source (TDS).

Benefits of Using TDS Amount Calculator

There are numerous benefits of using a calculating tool for Tax Deducted at Source, including:

• The TDS calculator helps you get an estimate of the TDS amount you need to pay.

• It instantly calculates your TDS and reduces manual effort and helps you plan your taxes efficiently.

• Registrationwala’s TDS calculating tool is the best TDS calculator in India. It is easy to use and provides immediate results based on your input.

• It helps you verify whether the deduction is as per the right section of the IT Act.

• Since this calculating tool is available online, you can use it anytime, anywhere.

• Since TDS is calculated in advance, any excess tax paid can be claimed as a refund in your ITR. The calculator ensures quick TDS calculations for better tax filing.

While TDS calculators are quite helpful for tax planning and compliance, it’s always advisable to consult a tax expert or refer to official guidelines from the Income Tax Department to stay updated on tax rules and rates.

How to Save Tax Deducted at Source?

Here are a few ways through which you can save TDS:

• Mediclaim Premium: You can ask for an 80D tax certificate from your insurer as proof of the premium you have paid.

• Travel Allowance: If your travel allowance is not included in your salary, you can request your employer to include it. 

• House Rent Allowance: If your rent exceeds a certain threshold limit per annum, you can claim House Rent Allowance by providing PAN details of your landlord.

• Residential Loan Interest: You can save on TDS by providing the lender’s details and bank certificate which reflect interest paid on residential loan.

• Food Vouchers: For food allowance, meal coupons up to Rs. 50 per meal (up to Rs. 2500 per month) are tax exempted. 

• Tuition Costs: You can submit signed receipts from educational institutions for tuition fees to save tax.

• Donations: Donations made to certain charitable trusts and NGOs are eligible for tax deduction. You must submit donation receipts with relevant credentials for claiming deduction.

• National Pension System: If you make a contribution under the National Pension contribution, you can save tax by providing deposit receipts and relevant bank statements.

FAQs: Tax Deducted at Source

Q1. How much TDS is charged if the PAN is not furnished?

A. If the PAN is not furnished or its details are incorrect, the TDS is deducted at a higher rate than usual, usually at 20% or the rate specified under the Income Tax Act (whichever is higher). This is in accordance with Section 206AA of the Act.

Q2. On which payments is the TDS required to be deducted?

A. TDS is required to be deducted on salaries, interest, commissions, rent, professional fees, technical services fees and other payments specified in the Income Tax Act.

Q3. Which platform offers the best TDS calculating tool in India?

A. Registrationwala offers the best TDS calculator India.

Q4. How is TDS Return filed in India?

A. In India, the TDS return is filed electronically by visiting the TRACES website of the Income Tax Department.

Disclaimer: Registrationwala’s TDS Calculator is for informational purposes only. We do not guarantee the accuracy of results. Users should consult a tax professional, as Registrationwala is not liable for any errors or consequences arising from TDS Calculator’s use.