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TDS Calculator FY 2025-26

Calculate TDS on salary, FD interest, rent, professional fees and contractor payments. Switch between sections using the tabs below.

What is TDS (Tax Deducted at Source)?

TDS stands for Tax Deducted at Source. It is a mechanism introduced by the Income Tax Department of India under the Income Tax Act, 1961, to collect tax at the very point where income is generated. Instead of the income earner paying the entire tax at the end of the year, the person making the payment (called the “deductor”) withholds a percentage of the payment as tax and deposits it with the government on behalf of the payee (called the “deductee”). TDS applies to various types of income such as salary, interest on fixed deposits, rent, professional fees, contractor payments, commissions, and more. Each type of income has a specific TDS section, rate, and threshold. The deductee receives a TDS certificate — Form 16 for salary or Form 16A for non-salary income — which they can use to claim credit while filing their Income Tax Return (ITR).

TDS on Salary — Section 192

Section 192 mandates that every employer must deduct TDS from employee salary before paying it. The employer estimates the employee's total annual salary, deducts standard deduction (₹75,000 under new regime or ₹50,000 under old regime), applies the chosen tax regime's slab rates, and computes the total tax liability. This annual tax is divided by 12 months, and that amount is deducted every month from the employee's salary as TDS.

Key points: Employers issue Form 16 summarizing salary and TDS details. Employees must declare their investment proofs (80C, 80D, HRA) to the employer for accurate TDS computation under the old regime. Under the new regime, fewer deductions are available, but the tax slabs are lower. If your employer deducts excess TDS, you can claim a refund by filing your ITR. Use our Income Tax Calculator for a detailed comparison of both regimes.

TDS on Fixed Deposit Interest — Section 194A

Banks and financial institutions deduct TDS at 10% on interest earned from fixed deposits if the total interest in a financial year exceeds ₹40,000 (₹50,000 for senior citizens aged 60 and above). This threshold applies per bank — so if you have FDs across multiple banks, the limit is calculated separately for each bank.

CategoryThresholdTDS Rate (PAN)No PAN Rate
Below 60 years₹40,000/year10%20%
Senior Citizens (60+)₹50,000/year10%20%

To avoid TDS if your income is below the taxable limit, submit Form 15G (below 60) or Form 15H (senior citizens) to your bank at the start of each financial year.

TDS on Rent — Section 194I & 194-IB

TDS on rent is governed by two sections depending on who is making the payment:

Section 194I (Businesses)

  • • Applies to businesses/professionals paying rent
  • • Land/Building/Furniture: 10% TDS
  • • Plant/Machinery: 2% TDS
  • • Threshold: ₹2,40,000/year

Section 194-IB (Individuals)

  • • Applies to individuals/HUF not under tax audit
  • • Rate: 5% TDS
  • • Threshold: ₹50,000/month (₹6L/year)
  • • TAN not needed — use PAN of landlord

Our TDS on rent calculator uses the 10% rate for payments exceeding ₹6L/year (Section 194I scenario). The tenant must deposit TDS with the government before the 7th of the following month and issue a TDS certificate to the landlord.

TDS on Professional Fees — Section 194J

Section 194J requires TDS at 10% on professional or technical service fees exceeding ₹30,000 in a financial year. This covers a wide range of professional services including fees paid to lawyers, doctors, accountants, architects, engineers, interior designers, and consultants. Technical services include IT consultancy, software development, and cloud services. Companies must also deduct TDS under Section 194J on director's fees (sitting fees, commission) without any minimum threshold. If a professional provides both technical services and royalties, the applicable rate may differ — 2% for technical services to certain entities, and 10% for professional services. Always verify the applicable rate with your CA.

TDS on Contractor Payments — Section 194C

Section 194C applies when making payments to contractors and sub-contractors. TDS must be deducted if any single payment exceeds ₹30,000 or total payments to the same contractor in a financial year exceed ₹1,00,000.

Payee TypeTDS Rate (with PAN)Without PAN
Individual / HUF1%20%
Company / Firm2%20%

This section is commonly applicable for contracts related to advertising, broadcasting, carriage of goods, catering, construction, manufacturing, and works contracts. Transport contractors with 10+ goods carriages are exempt from TDS under 194C if they furnish PAN.

What Happens if You Don't Provide PAN?

Under Section 206AA, if the payee does not furnish their PAN to the deductor, TDS is deducted at the higher of: 20%, or twice the applicable rate, or the rate in force. For most TDS sections, this effectively means 20% TDS without PAN. This is significantly higher than the normal rates (for example, 20% vs 1% for contractor TDS). To avoid this penalty, always:

  • Share your PAN with your employer, bank, and any entity making payments to you
  • Ensure your PAN is linked to your Aadhaar (mandatory since July 2024)
  • If you don't have a PAN, apply at NSDL e-Gov — Aadhaar-linked instant PAN is available in minutes

Frequently Asked Questions

TDS (Tax Deducted at Source) is income tax collected at the point of income generation itself. The payer (employer, bank, tenant, etc.) deducts a percentage of the payment as tax before paying the remaining amount to the payee. TDS is deducted when income exceeds specified thresholds — for example, banks deduct TDS on FD interest exceeding ₹40,000/year. TDS ensures a steady flow of tax revenue for the government and prevents large year-end tax burdens for taxpayers.
TDS on salary under Section 192 is calculated by the employer based on the employee's estimated annual income and applicable tax slab. The employer considers the chosen tax regime (old or new), standard deduction (₹75,000 new / ₹50,000 old), declared investments under 80C/80D (old regime only), and HRA exemption. The total estimated tax liability is then divided by 12 months, and that amount is deducted monthly as TDS from your salary.
TDS on FD interest is deducted under Section 194A at 10% if annual interest from all FDs with the same bank exceeds ₹40,000 (or ₹50,000 for senior citizens aged 60+). If your total income is below the taxable threshold, you can submit Form 15G (or Form 15H for senior citizens) to the bank requesting no TDS deduction. Without PAN, TDS is deducted at 20% instead of 10%.
TDS on rent applies differently based on who is paying. Under Section 194I, businesses and professionals must deduct 10% TDS if annual rent exceeds ₹2,40,000. Under Section 194-IB, individuals and HUFs not covered by tax audit must deduct 5% TDS if monthly rent exceeds ₹50,000 (₹6,00,000/year). The tenant must obtain a TAN, deduct TDS, and deposit it with the government before the 7th of the following month.
TDS on professional and technical service fees under Section 194J is 10%. This applies when the payment to a professional exceeds ₹30,000 in a financial year. This section covers payments for legal advice, medical consultation, engineering, accounting, interior decoration, and technical services. Companies must also deduct TDS on director fees under this section without any threshold.
If TDS has been deducted but your total income falls below the taxable threshold, you can claim a refund by filing your Income Tax Return (ITR). The excess TDS will be refunded directly to your bank account by the Income Tax Department, usually within 60-90 days of processing your return. You can track the refund status at incometax.gov.in. To avoid unnecessary TDS deduction on FD interest, submit Form 15G/15H to your bank at the start of the financial year.
If the payee (person receiving income) does not provide their PAN to the deductor, TDS is deducted at a higher rate of 20% (or twice the applicable rate, whichever is higher) under Section 206AA. This is a significant penalty for not furnishing PAN. For example, TDS on FD interest normally at 10% jumps to 20% without PAN. Always share your PAN with your employer, bank, and other payers to avoid this higher deduction.
TDS is deducted by the payer (employer, bank, tenant) before making a payment to you, while advance tax is paid by the taxpayer themselves on their estimated annual income in quarterly installments. Salaried employees covered by TDS usually don't need to pay advance tax unless they have significant non-salary income. Self-employed professionals and businesses must pay advance tax if their tax liability exceeds ₹10,000 in a year, by the 15th of June, September, December, and March.

Last updated: March 2026. TDS rates are as per the Income Tax Act, 1961, applicable for FY 2025-26. This calculator is for estimation purposes only. Visit incometax.gov.in for official information.

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