1. What is TDS (Tax Deducted at Source)?

 TDS (Tax Deducted at Source) is a system where a person or company making a payment (like salary, interest, rent, etc.) deducts a small percentage of tax before paying the recipient. The deducted tax is then sent to the government.

·         Example: If your employer pays you ₹50,000/month, they may deduct 10% (₹5,000) as TDS and give you ₹45,000. The ₹5,000 goes to the Income Tax Department.

·         Purpose: Ensures the government collects tax in advance instead of waiting until year-end.

 

2. When and why is TDS Deducted?

TDS is deducted in various situations:

Payment Type	When TDS is Cut	Why?
Salary	Every month	Employer deducts tax based on your income slab
Bank Interest	If interest > ₹40,000/year (₹50,000 for seniors)	To track earnings from savings
Rent	If rent > ₹50,000/month	Ensures landlords pay tax
Contractor Payments	If payment > ₹30,000 (single/recurring)	Prevents tax evasion

Exceptions: No TDS if you submit Form 15G/15H (for interest income) or show a lower tax slab.

 

3. How to Check TDS Deducted Using Form 26AS?

Form 26AS is a tax credit statement showing all TDS deductions against your PAN.

Ø  Steps to Check:

1.      Go to Income Tax e-Filing Portal.

2.      Login with PAN & password.

3.      Click "View Form 26AS" under "My Account".

4.      Select the financial year and view/download.

Ø  What’s?

·         TDS deducted by employers/banks

·         Advance tax paid by you

·         Refunds received

 

4. Eligibility for TDS Refund

You can claim a TDS refund if:
✔ Total tax deducted (TDS) > Your actual tax liability
✔ You filed Income Tax Return (ITR)
✔ No pending tax dues

Example:

·         Your total tax liability = ₹10,000

·         TDS deducted = ₹15,000

·         Refund due = ₹5,000

5. Step-by-Step Guide to Claim TDS Refund Online

Follow these steps to get your refund:

1.      File ITR (Income Tax Return) on the e-Filing Portal.

2.      Select Correct ITR Form (ITR-1 for salaried, ITR-2 for house property income, etc.).

3.      Enter TDS Details (from Form 26AS).

4.      Verify ITR using Aadhaar OTP or EVC.

5.      Refund Processing begins after ITR is verified.

6. How to File ITR for TDS Refund?

1.      Gather Documents:

o    Form 16 (from employer)

o    Form 26AS (TDS details)

o    Bank statements

o    Rent receipts (if applicable)

2.      Choose ITR Form:

o    ITR-1 (Sahaj): Salaried individuals (income < ₹50 lakh, no house property).

o    ITR-2: For capital gains or multiple house properties.

3.      File Online:

o    Enter income details.

o    Add TDS from Form 26AS.

o    Submit & verify.

 

7. How long does it take to get a TDS Refund?

·         Normal Processing: 3-6 months after ITR filing.

·         Fastest Cases: Some get refunds in 1-2 months if no errors.

·         Delays Possible if:

o    ITR has mistakes

o    Tax Dept. checks documents

 

8. Common Reasons for TDS Refund Delay

Incorrect Bank Details (Account number/IFSC mismatch)
🚫 Unverified ITR (Must verify via Aadhaar OTP or EVC)
🚫 Pending Tax Dept. Scrutiny (If high refund claimed)
🚫 Mismatch in TDS & Form 26AS (Employer/bank didn’t report TDS correctly)

Solution: Check refund status & correct errors.

 

9. How to Track TDS Refund Status?

1.      Visit IT Refund Status Portal.

2.      Enter PAN & Assessment Year (e.g., AY 2024-25 for FY 2023-24).

3.      Check status:

o    "Refund Issued" → Check bank account.

o    "Processing" → Wait.

o    "Failed" → Update bank details.

 

10. Difference between TDS and Advance Tax

Feature	TDS	Advance Tax
Who Pays?	Deducted by payer (employer/bank)	Paid directly by taxpayer
When?	At payment time	In installments (June, Sept, Jan, etc.)
For Whom?	Salaried, investors, contractors	Business, freelancers, high-income earners
Example	Salary TDS by employer	Freelancer pays tax in advance

Key Point:

·         TDS = Someone else deducts tax for you.

·         Advance Tax = You pay tax in advance if liability > ₹10,000/year.