Hi,
Tax Deducted at Source stand is referred to as TDS. Any company or person making a payment is required by the Income Tax Act to deduct tax at the source if the payment exceeds a certain threshold amount. Professional fees are under the category of payment, and they are subject to the 10% tax rate. I will explain TDS to you with the help of a few examples.
1) Assume Mr. Patil makes Rs. 70,000 per year in pay. Mr. Patil receives his entire payment once the service is completed. In this case, his payee will pay him Rs. 63,000 in exchange for his services after deducting a tax of Rs. 7,000 from the total sum.
2) Before paying Mr. XYZ's ₹30,000 in professional fees, X Company is required to deduct ₹3,000 in taxes. Following that, Mr. XYZ will receive a total payment from X company of Rs 27,000 (Rs 30,000 minus Rs 3,000 tax). The corporation will then provide the government with the 2,000 rupees right away.
I hope you are now clear about what is Tax Deducted at Source.
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What is Tax Deducted at Source?
Prem Sunderdas
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3 Year
2022-12-20T10:11:14+00:00 2022-12-20T10:11:15+00:00Comment
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