TDS Calculator

TDS Calculator: work out tax deducted at source in seconds

Tax Deducted at Source (TDS) is a system where the person making a payment deducts a slice of tax before handing over the money, and deposits it with the government against the recipient's PAN. The recipient later claims that amount as credit while filing their income tax return. This TDS Calculator helps you find how much should be deducted on common payments such as salary, bank interest, rent and professional fees, so you can check a deduction, plan your cash flow, or verify a payslip or invoice.

It is built for salaried employees checking Form 16 numbers, freelancers and consultants raising invoices, landlords and tenants, small businesses that pay contractors, and finance teams reconciling Form 26AS. If money is changing hands and a TDS section applies, this tool tells you the deduction and the net amount payable.

The formula in plain words

The core idea is simple. First check whether the payment crosses the threshold for its section. If it does, TDS is normally charged on the full amount (not just the excess above the threshold):

• TDS amount = Payment amount × applicable rate
• Net amount paid to recipient = Payment amount − TDS amount

Salary (Section 192) is the exception. There the employer estimates your total annual salary, works out the tax on it using the income tax slabs and cess for the regime you choose, and then spreads that annual tax across the remaining months of the year. So the effective salary TDS rate is your average rate of tax, not a flat percentage.

A fully worked example: rent under Section 194-I

Suppose a company pays office rent of Rs. 60,000 per month to a landlord. Follow the steps:

• Step 1 — Annual rent: Rs. 60,000 × 12 = Rs. 7,20,000.
• Step 2 — Threshold check: As of FY 2025-26 the Section 194-I trigger is rent exceeding Rs. 50,000 per month (raised in Budget 2025 from the earlier Rs. 2,40,000 per year). Rs. 60,000 crosses it, so TDS applies.
• Step 3 — Rate: Rent of land, building or furniture attracts 10% (plant and machinery is 2%). Here it is 10%.
• Step 4 — TDS per month: Rs. 60,000 × 10% = Rs. 6,000.
• Step 5 — Net paid to landlord: Rs. 60,000 − Rs. 6,000 = Rs. 54,000 each month.
• Step 6 — For the year: Rs. 6,000 × 12 = Rs. 72,000 total TDS, which the landlord claims as credit in their return.

The same three-step logic (threshold, rate, deduct) applies to a consultant's bill. A professional fee of Rs. 1,50,000 under Section 194J at 10% means TDS of Rs. 15,000 and a net payout of Rs. 1,35,000.

Common sections, rates and thresholds (as of FY 2025-26)

• 192 – Salary: deducted at your average slab rate; no flat rate, no fixed threshold beyond the basic exemption.
• 194A – Interest on bank/co-operative/post office deposits: 10%, once interest crosses Rs. 50,000 in a financial year (Rs. 1,00,000 for senior citizens).
• 194-I – Rent: 10% for land/building/furniture, 2% for plant and machinery, where rent exceeds Rs. 50,000 per month.
• 194-IB – Rent paid by individuals/HUF not under tax audit: 2% where monthly rent exceeds Rs. 50,000, deducted once a year.
• 194J – Professional or technical fees: 10% for professional services, 2% for technical services, once aggregate payments in the year exceed Rs. 50,000.
• 194C – Contractor payments: 1% (individual/HUF) or 2% (others), on a single contract above Rs. 30,000 or Rs. 1,00,000 aggregate in a year.

Several of these thresholds were revised upward in Budget 2025, so always confirm the current year's figure before relying on it.

Edge cases and tax treatment

• No PAN: under Section 206AA the deductor must cut TDS at 20% (or the normal rate, whichever is higher). Always share a valid PAN.
• Lower or nil deduction: recipients can apply for a certificate under Section 197, and small taxpayers can submit Form 15G/15H to stop interest TDS when their income is below the taxable limit.
• TDS is not an extra tax: it is an advance instalment of your own income tax. If too much is deducted, the excess comes back as a refund when you file your ITR.
• Timing: TDS is generally deducted at the earlier of credit or payment, and must be deposited by the due date to avoid interest and penalties.

Tips and common mistakes

• Do not deduct only on the amount above the threshold — once the limit is crossed, TDS applies to the full payment.
• Do not confuse TDS with GST; they are calculated separately, and income-tax TDS is charged on the value excluding GST where the GST is shown separately on the invoice.
• Match your deductions against Form 26AS and the Annual Information Statement before filing to catch missing credits.
• Deposit deducted tax on time — late deduction attracts interest of 1% per month and late deposit after deduction attracts 1.5% per month.
• Use the correct section; a technical service billed as a professional fee can lead to a short deduction and a later demand.

Frequently asked questions

What is the difference between TDS and income tax?

TDS is not a separate tax; it is an advance collection of your income tax deducted by the payer before you receive the money. When you file your return, TDS already paid is adjusted against your total tax liability, and any excess is refunded.

At what rate is TDS deducted on my salary?

There is no flat rate for salary under Section 192. The employer estimates your annual salary, calculates the tax using the applicable income tax slabs and cess for your chosen regime, and deducts it in monthly instalments at your average rate of tax.

What happens if I do not provide my PAN?

Under Section 206AA, if you do not furnish a valid PAN, TDS is deducted at 20% or the normal applicable rate, whichever is higher. Always share your PAN to avoid the higher deduction.

When is TDS deducted on bank fixed deposit interest?

Banks deduct TDS at 10% once your interest income crosses the annual threshold, which as of FY 2025-26 is Rs. 50,000 for general depositors and Rs. 1,00,000 for senior citizens. You can submit Form 15G or 15H to avoid deduction if your total income is below the taxable limit.

Is TDS calculated on the amount above the threshold or the full amount?

Once a payment crosses the threshold for its section, TDS is charged on the entire amount, not just the portion above the limit. The threshold only decides whether TDS applies at all.

Can I get a refund if excess TDS is deducted?

Yes. If the tax deducted is more than your actual liability, you claim the excess by filing your income tax return, and the Income Tax Department refunds the difference after processing.