Q: What is the Formula that is Used to Calculate TDS?

The formula used to calculate TDS is: Average Income Tax Rate = Income Tax Payable (calculated with slab rates) / Estimated income for the financial year.

Question 1

What is TDS?

Accepted Answer

TDS stands for Tax Deducted at Source. It is a specific amount that is deducted by the employer from the taxpayer, which is later deposited into the IT department on behalf of the taxpayer. The main aim of TDS is to help the government keep track of the income earned by a taxpayer during the year. The applicable amount of TDS may vary based on various transactions and the type of taxpayer.

Question 2

How Does a TDS Calculator Help?

Accepted Answer

A TDS calculator helps you to calculate the amount of TDS that is required to be deducted before making a payment.

Question 3

What is the Formula that is Used to Calculate TDS?

Accepted Answer

The formula used to calculate TDS is:

Average Income Tax Rate = Income Tax Payable (calculated with slab rates) / Estimated income for the financial year.

Question 4

How Does the TDS Calculator Work?

Accepted Answer

The TDS calculator works on an algorithm and through a formula box to calculate the TDS based on the basic information that you provide.

Question 5

Can NRIs Use the TDS Calculator?

Accepted Answer

Yes, an NRI can also use the TDS calculator.

Question 6

Does the Calculator Show the TDS Rate With and Without PAN?

Accepted Answer

Yes, the calculator shows the TDS rate with as well as without PAN card. However, remember that if you have a PAN card, the TDS rates will apply at the normal applicable rates. On the other hand, if you don't have a PAN card, you might have to pay higher TDS rates.

Question 7

Is the TDS Rate Fixed for All Income Types?

Accepted Answer

No, the TDS rate is not fixed for all income types as it may vary based on the nature of the income and the recipient, such as resident, NRI, senior citizen, etc.

Question 8

Can I Calculate TDS for the Sale of Property Using this Tool?

Accepted Answer

Yes, you can calculate the TDS amount for all the sections that come under TDS deduction, including TDS for the sale of property.

TDS Calculator

Frequently Asked Questions

TDS Calculator

Frequently Asked Questions