What is TDS (Tax Deducted at Source)?
Tax deducted at source (TDS) on salary is income tax your employer deducts each month from your pay and deposits with the government on your behalf. The deduction is based on your estimated yearly tax. At year end the employer issues Form 16 showing the tax deducted and deposited.
Example
If your estimated yearly tax is Rs 1,20,000, an employer typically deducts about Rs 10,000 a month, adjusted for declarations and changes. The sections are 192 of the Income-tax Act, 1961, and 392 of the Income-tax Act, 2025 for payments on or after 1 April 2026, per the Income Tax Department.
Related
TDS is not a Labour Code item. See Form 16, PAN and CTC vs in-hand salary.
Related terms and guides
Sources
- Income Tax Department, Government of India, https://www.incometax.gov.in, live official page, linked for readers; link checked 2026-10-31
This is general information, not legal, tax or immigration advice. Rules change and your situation may differ. Consult a licensed attorney or qualified adviser.