Tax Deducted At Source - What is TDS & Why is it Deducted

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Tax Deduced at source (TDS) is a means of collecting income tax in India, governed under the Indian Income Tax Act of 1961. Learn more about what is TDS and why is it deducted.

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Tax Deducted at Source: What is TDS Why is it Deducted C Axis Bank Ltd.

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What Is TDS C Axis Bank Ltd. TAX DEDUCTED AT SOURCE TDS • Tax Deducted at Source or TDS is one of the modes of collecting tax in India • TDS is deducted in case of employee salary rent and payment for professional or contractual services by the deductor and remitted to the Government account • The most common and relatable example of TDS is the monthly deduction from your salary. Based on your income and IDF Investment Declaration Form submitted to your company the TDS is calculated as per the prescribed income tax slab and gets deducted equitably every month from your account

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SECTION CODES DEFINED FOR TDS C Axis Bank Ltd. TDS is governed by the Central Board of Direct Taxes CBDT under the Income Tax Act 1961. CBDT is a part of the Indian Revenue Services which come under direct jurisdiction of the Ministry of Finance in India. Some of the important section codes under which deduction of TDS is defined are: Section Code Type of Payment Threshold Limit Rs. Tax Rate 192 Salary to a resident/NRI - As per the prescribed tax slab for a financial year 193 Interest on securities - 10 194 Dividends earned - 10 194A Interest other than interest earned on securities 5000 10 194C Contracts and sub-contracts 30000 1 194D Insurance commission 20000 10 194EE Payments for deposits under National Service Scheme 2500 20 194F Payment for repurchase of units of Unit Trust of India or mutual funds 1000 20 194H Brokerage commission 5000 10

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WHY IS TDS DEDUCTED C Axis Bank Ltd. The reasons for deducting TDS can be perceived in the form of benefits that TDS offers. Some of the benefits of deducting TDS are as follows: • It promotes the sharing of the responsibilities of tax collection between the Government and Deductors companies or individuals • It helps prevent the malpractice of evading tax • It acts as an effective mode of capital inflow required by the Government to function

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SUMMARY C Axis Bank Ltd. It is clear how TDS plays a crucial role in keeping tax evasion in check while financially strengthening the Government to function properly and implement developmental work for the growth of the country. Learn more about Tax Deducted At Source or TDS at It’s All About Money.

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THANK YOU Visit www.itsallaboutmoney.com to know more. C Axis Bank Ltd.

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