Important Things You Must Know About TDS
The TDS stands for Tax Deduction at Source. Every individual must pay the government a certain amount of tax over a certain amount of income. TDS allows you to pay a certain amount of money to the firm that you are working on a monthly basis. You do not have to pay the lump sum amount at the end of every year if you opt for TDS.
One must know certain rules about TDS. Here are the important things you must know about TDS.
You need to give the correct PAN number so it will be directly connected to your bank accounts. If you do not give the PAN number, you will have to bear an additional 20% penalty.
Do not go with TDS deposit as it attracts a penalty, say around 1.5%. You can always go with monthly TDS deduction.
You must be aware of the files and if there are any discrepancies, it must be cleared before making any submission.
Do not fail to use the same TAN in your TDS if you have claimed any settlement of expenses. You must produce the receipts and the certificate of the same.
Ways to avoid TDS for fixed deposits:
Diversify Your FD:
You have opt for FDS in different banks and there is a rule that even if you have collected an interest of more than Rs. 10,000, the banks aren’t liable to deduct and taxes. These days banks have become smarter and hence it is better to check the bank policies.
Submitting Forms 15H and 15G:
These are the firms that you must submit indicating that you are not eligible to pay any taxes provided the amount excess Rs. 5000 or Rs 10000. 15H is for senior citizens whereas 15G is for people below 60 years of age.
Do consider these points.