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Meaning of TDS

TDS means Tax Deducted at Source.

It is a tax which is to be deducted on some expenses and payments

 As per Income Tax Act, persons responsible for making payments are required to deduct TDS at different rates.

Example

Suppose Max Ltd provided Consultancy Service to ABC Ltd for 40000

In this case,ABC will pay Max Rs 40000.

However,if in this cases,TDS @ 10% is to be deducted, then ABC will deduct 4000,and  pay Max only 36000

ABC will deposit this 4000 TDS with Government

 

  What is TDS - Different Taxes In India

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CA Maninder Singh

CA Maninder Singh is a Chartered Accountant for the past 12 years. He also provides Accounts Tax GST Training in Delhi, Kerala and online.