TDS on Salary explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Employers deduct TDS on salary under Section 192 based on your estimated annual tax. Here is how it is calculated.
How TDS on salary works
- The employer estimates your annual taxable salary
- Applies the slab rates of your chosen regime
- Divides the annual tax across the remaining months and deducts monthly
What is considered
- Salary, allowances and perquisites
- Declared deductions (80C, 80D, HRA) under the old regime
- Other income you declare to the employer
Note
The TDS is reflected in Form 16 and Form 26AS; reconcile it while filing your ITR.
Frequently Asked Questions
How is TDS on salary calculated?
On your estimated annual taxable salary at the slab rates of your chosen regime, deducted monthly.
Which section governs TDS on salary?
Section 192 of the Income-tax Act.
Can I reduce salary TDS?
Yes — by declaring eligible deductions/investments to your employer under the old regime.
Where is salary TDS shown?
In Form 16 and Form 26AS.
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