TDS Calculator

A TDS Calculator computes the Tax Deducted at Source on a payment — the amount the payer must withhold and deposit with the Income Tax Department before remitting the balance to the recipient. TDS is India's primary mechanism for collecting direct tax at the point of payment, covering everything from FD interest and rental income to professional fees, contractor payments, and property purchases.

TDS is governed by Chapter XVII-B of the Income Tax Act, 1961, and covers over a dozen payment categories, each with its own section, rate, and exemption threshold. The rate applicable to a payment depends on three factors: the nature of the payment (which determines the section), whether the recipient has furnished a valid PAN (missing PAN triggers Section 206AA, raising the rate to a minimum of 20%), and whether the payment amount exceeds the specified threshold for that section.

Understanding your TDS liability before making or receiving a payment matters for two distinct reasons. For deductors — businesses, landlords, and individuals — failing to deduct TDS or depositing the wrong amount triggers interest (1% per month for non-deduction, 1.5% per month for late deposit) and can result in disallowance of the payment as a business expense. For recipients — employees, freelancers, FD holders, and property sellers — knowing the expected TDS helps in planning quarterly advance tax payments and ensures no surprises when the net amount hits the account.

This calculator covers the nine most common TDS sections in India, including Section 194A (FD and bank interest), Section 194I (rent), Section 194J (professional and technical fees), Section 194C (contractor payments), Section 194H (commission and brokerage), and Section 194-IA (property purchase above ₹50 lakh). It also models the Section 206AA rate for cases where PAN has not been furnished.

Unlike GST Calculator which computes the indirect tax component added to a transaction, TDS reduces the recipient's income — it is a direct tax collected upfront, recoverable through the ITR filing process.

1. Select the Payment Type — choose the correct TDS section from the dropdown. Each option shows the section number and applicable rate. If you are unsure which section applies, select the type that best describes the nature of the payment: FD/bank interest (194A), rent for a building (194I), professional consultancy fees (194J), contractor/sub-contractor work (194C), commission or brokerage (194H), or a property transaction above ₹50 lakh (194-IA).

2. Enter the Payment Amount — the gross payment amount before any deduction, in rupees. For FD interest, enter the total interest earned from one bank in the financial year. For rent, enter the annual rent payable. For property purchase, enter the total transaction value. Do not enter the net amount — the calculator derives the net from the gross.

3. Set PAN Provided — select "Yes" if the recipient has furnished a valid PAN, or "No" if PAN is unavailable or invalid. The PAN status directly determines whether the standard rate or the higher 20% Section 206AA rate applies. Always verify PAN at the time of payment — collecting it retrospectively after a dispute is far more difficult.

4. Read the Section Info card — this shows the applicable section code, the with-PAN and without-PAN rates, the threshold limit, and a coloured status badge indicating whether TDS is applicable (orange) or not (green). If the amount is below the threshold, the card also shows how much more is needed before TDS triggers.

5. Review TDS Deducted and Net Amount — these are the two numbers the deductor needs for payment processing and the recipient needs for cash flow planning. If TDS Rate Applied shows 0%, the payment falls below the threshold and no deduction is required.

6. Expand "How was this calculated?" — the step-by-step breakdown confirms the section applied, the threshold check, the rate used, and the arithmetic. This is useful for explaining the deduction to a vendor or client who queries the net amount received.