TDS Calculator: Rates, Sections & How to Avoid Excess TDS
That 10% Cut From Your FD? Here’s How to Get It Back
TDS (Tax Deducted at Source) is the government’s way of collecting tax at the point of income. Your bank deducts 10% from FD interest above ₹40,000. Your employer deducts estimated income tax from your salary each month. Freelancers face 10% TDS on every invoice. But here’s what many people miss: TDS is not a separate tax. It’s an advance payment toward your total tax liability. If your actual tax is lower than TDS deducted, you get the excess back as a refund.
Common TDS Sections & Rates
| Section | Income Type | TDS Rate | Threshold |
|---|---|---|---|
| 192 | Salary | As per slab rates | Basic exemption limit |
| 194A | FD / RD interest (bank) | 10% | ₹40,000/year (₹50K for seniors) |
| 194B | Lottery / game show winnings | 30% | ₹10,000 |
| 194C | Contractor payment | 1% (individual) / 2% (others) | ₹30,000 per payment / ₹1L total |
| 194H | Commission / brokerage | 5% | ₹15,000 |
| 194I | Rent | 2% (plant) / 10% (land/building) | ₹2,40,000/year |
| 194J | Professional / technical fees | 10% | ₹30,000 |
| 194N | Cash withdrawal (large) | 2% | ₹1 crore |
If you don’t furnish PAN, TDS jumps to 20% in most cases. Always ensure your PAN is linked with your income sources.
How to Avoid Excess TDS on FD Interest
If your total income is below the taxable limit, you shouldn’t be paying any TDS. Submit these forms to your bank:
- Form 15G: For individuals below 60 years with total income below taxable limit
- Form 15H: For senior citizens (60+) with total income below taxable limit
Submit at the start of each financial year (April). The bank will not deduct TDS if valid Form 15G/15H is on file. This is especially important if you have FDs across multiple banks — submit the form at each bank.
How to Check Your TDS: Form 26AS
Form 26AS is your consolidated TDS statement. It shows every TDS deduction made against your PAN across all sources. Access it through:
- Log in to the Income Tax e-Filing portal
- Navigate to e-File → Income Tax Returns → View Form 26AS
- Or check via your net banking (most major banks provide access)
Always verify your Form 26AS before filing ITR. If TDS has been deducted but doesn’t appear in 26AS, the deductor hasn’t filed their TDS return — follow up with them.
Claiming TDS Refund
File your Income Tax Return (ITR) to claim excess TDS back. The refund process:
- Calculate actual tax liability using the income tax calculator
- Compare with total TDS deducted (from Form 26AS)
- If TDS > actual tax, file ITR claiming the refund
- Refund is typically processed within 30–60 days of ITR verification
Interest at 6% p.a. is paid on delayed refunds (from the date of ITR filing to the date of refund).
TDS for Freelancers & Consultants
If you’re a freelancer receiving payments under Section 194J, your clients deduct 10% TDS. This means on a ₹1 lakh invoice, you receive only ₹90,000. If your actual tax rate is lower than 10% (or you have business expenses), you’ll get the excess back as a refund when filing ITR. Track all TDS deductions in Form 26AS and file ITR-3 or ITR-4 (depending on turnover). Use the TDS calculator to estimate deductions across your income sources.