Tax deducted at source (TDS)

In practice

For salary, TDS is a monthly cycle: compute it in the payroll run, deduct it from pay, deposit it to the government by the due date for that month, then report it each quarter on Form 24Q and certify it to the employee on Form 16 after the year ends.

As an example, if payroll for June is paid on 30 June, the TDS deducted is deposited in July under the employer's TAN, appears in the April to June Form 24Q, and later shows in the employee's tax credit statement. A gap anywhere in that chain shows up for the employee as missing tax credit.

The common failures are late deposits, which carry interest, and PAN errors, which leave the credit stranded and may require deduction at a higher rate where no valid PAN is held. Validate PANs at onboarding rather than at the quarterly return. HRMagix generates Form 24Q and Form 16 from the payroll run.

Questions that involve TDS

• How does HRMagix automate Indian statutory compliance (EPF, ESI, PT, TDS)?Answered on Questions & Answers
• Is this payroll software with PF, ESI and TDS built in, or do we need something separate?Answered on Questions & Answers
• Can employees compare the old and new tax regimes before declaring?Answered on Payroll
• Does HRMagix generate Form 16?Answered on Payroll
• How are arrears from a backdated increment handled?Answered on Payroll