Frequently Asked Questions
How is TDS calculated on salary? ＋
TDS on salary is calculated based on the employee's estimated annual income and applicable tax slab. The employer divides the annual tax liability by 12 and deducts it monthly. Standard deduction of ₹75,000 (new regime) or ₹50,000 (old regime) applies. Professional tax and Chapter VI-A deductions also reduce TDS.
What is TDS on rent above ₹50,000 per month? ＋
Under Section 194IB, if an individual or HUF pays rent exceeding ₹50,000 per month, they must deduct TDS at 5% once a year (at the end of the year or tenancy). File Form 26QC and issue Form 16C to the landlord. No TAN is required for this.
What is the TDS rate on professional fees? ＋
TDS under Section 194J is 10% on professional fees (doctor, lawyer, architect, CA, etc.) when payment exceeds ₹30,000 per year. For technical services, it is 2%. If PAN is not provided, deduct 20%.
How do I calculate TDS on contractor payments? ＋
Under Section 194C, TDS is 1% for payments to individuals/HUF contractors and 2% for others. Threshold is ₹30,000 per single payment or ₹1,00,000 aggregate per year. If PAN is not provided, deduct 20%.
What is Form 16 and Form 16A? ＋
Form 16 is a TDS certificate issued by employers to employees for TDS deducted on salary (Section 192). Form 16A is issued for TDS on non-salary payments (rent, professional fees, interest, etc.). Both are issued quarterly/annually and are required for filing income tax returns.