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MDC, 1st Floor, Azad market, Pirmuhani Chowk, Kadamkuan, Near Uma Cinema, Patna, Bihar, 800003
TDS & TCS
Tax Deducted at Source (TDS) and Tax Collected at Source (TCS)
Tax Deducted at Source (TDS) is a system introduced by the Income Tax Department of India, where a person responsible for making payments (such as salary, interest, rent, etc.) deducts a portion of the payment as tax and deposits it to the government.
Tax Collected at Source (TCS) is a system where a seller collects tax from the buyer at the time of sale of certain goods or services.
Purpose of TDS/TCS
- Collect taxes: TDS/TCS helps the government collect taxes from various sources.
- Reduce tax evasion: TDS/TCS reduces the chances of tax evasion, as the tax is deducted or collected at the source.
- Simplify tax compliance: TDS/TCS simplifies tax compliance for taxpayers, as the tax is deducted or collected automatically.
Types of TDS
| TDS on Salary (Section 192) |
| TDS on Interest (Section 194A) |
| TDS on Rent (Section 194I) |
| TDS on Commission (Section 194D) |
Types of TCS
| TCS on Sale of Goods (Section 206C) |
| TCS on Services (Section 206C) |
TDS on Salary: 10% to 30% of the salary
TDS on Interest: 10% of the interest
TDS on Rent: 10% of the rent
TCS on Sale of Goods: 0.1% to 5% of the sale value
TCS on Services: 10% to 15% of the service value
TDS/TCS Returns
TDS/TCS returns are filed by the deductor/collector with the Income Tax Department. The returns are filed quarterly or annually, depending on the type of payment or sale.
Penalties for Non-Compliance:
Failure to deduct or collect TDS/TCS, or failure to file TDS/TCS returns, can result in penalties and fines.
