Tax Deducted at Source (TDS)

Tax Deducted at Source (TDS) is one of the modes of collecting income tax. The buyer (deductor) deducts the tax from the payment made to the seller (deductee) and remits the tax to the Income Tax Department within the stipulated time.

The buyers (Corporate and Non-Corporate) make payments (such as Salary, Rent, Interest on securities, Dividends, Insurance Commission, Professional Fees, Commission on Brokerage, Commission on Lottery Tickets, etc) to the sellers (Services) and deduct the requisite amount from such payments towards tax.

The buyer files the TDS returns containing details of the seller and the bank, where the TDS amount is deposited to the Income Tax Department (ITD).

The Income Tax Department has prescribed the formats for filing these returns electronically, which the buyer does in a CD/floppy.

For additional details you can visit the Income Tax Website at http://www.incometaxindia.gov.in