Tax deduction at source TDS is less known tax item by individuals. There are some points which everybody should know about TDS. These are 6 points which are as under.
1- Tax deduction at source is TDS in which in some cases where the person who pays any sum to the assessee need to deduct tax from the payment.
2- There are some incomes in which TDS deducts and some which doesn’t attract TDS. Salary income, rent income, commission, lottery, horse races, winning any puzzle, fees for technical services etc. attract TDS.
3- The rate of TDS is different as per income type and government may change these rates every year. There is also some threshold limit (means only above this will attract TDS) on some type of income. One can know the running rates of TDS and threshold limit of TDS from here.
4- The deductor who deducts the tax from the payment needs to provide TDS deduction form 16/16A to the deductee. In the form, all the details about the deductee name, pan number and amount deducted are mentioned. This form is important while filing income tax return and getting income tax refund.
5- The deductor needs to deposit the tax deducted amount in the government account via banks within a week of the end of the month in which the deduction is made.
6- TDS return must be filled by the deductor quarterly in the forms prescribed by income tax department. The due dates are 15 July, 15 October, 15 January and 15 May.