TDS Basics Explained: Rates, Certificates, and How to Claim Credit in Your ITR

Tax Deducted at Source (TDS) is a mechanism by which the payer deducts a fixed percentage of tax from the payment made to the recipient and deposits it with the Income Tax Department. It is a withholding tax that applies to salaries (Section 192), interest income (Section 194A), rent above ₹2.4 lakh per year (Section 194I), professional fees above ₹30,000 per year (Section 194J), e-commerce payments (Section 194O), and property purchases above ₹50 lakh (Section 194-IA).

The deductor must deposit TDS by the 7th of the following month (30th April for March deductions) and file quarterly TDS returns (Form 24Q for salary, 26Q for other than salary). If you are a recipient, TDS certificates are issued — Form 16 for salary (by June 15) and Form 16A for other payments (within 15 days of the due date for filing the quarterly return). These certificates show the amount of TDS deducted and deposited on your behalf.

To verify all TDS credited to your account, download Form 26AS and the Annual Information Statement (AIS) from the Income Tax portal (incometax.gov.in). Form 26AS consolidates all TDS, advance tax, and self-assessment tax paid in your name. If a deductor has not deposited TDS or has filed incorrectly, the credit will not appear in your 26AS — contact the deductor immediately as this can delay your refund processing.

When filing your ITR, claim TDS credit by entering TDS details from Form 16/16A in the appropriate schedule. The tax department matches this with their records. If the credit matches, your refund (if any) is processed typically within 20-45 days of e-verification. Always file ITR even if your entire tax has been deducted via TDS — this is required by law if your gross income exceeds the basic exemption limit, and it allows you to claim refunds and carry forward losses.