How the TDS Calculator Works Section by Section
Tax deducted at source means the person making a payment withholds a slice of it and deposits that with the government in the recipient's name. This calculator tells you how big that slice is. You pick the section that matches the payment — 194C for contractor work, 194J for professional or technical fees, 194I for rent, 194H for commission and brokerage, 194A for interest, and a few others — enter the gross amount, and it returns the TDS deducted and the net figure the recipient actually receives. Businesses making vendor payments, freelancers who want to know why an invoice was short-paid, landlords receiving rent from a company tenant, and anyone reconciling receipts against Form 26AS all use it.
The arithmetic is one multiplication: TDS = gross payment × applicable rate ÷ 100, and net payable = gross payment − TDS. What makes TDS confusing is not the maths but picking the right rate, since it is determined entirely by the nature of the payment rather than the amount. The rates built in here follow the common ones: 1 per cent for contractor payments to an individual or HUF and 2 per cent to others under 194C, 10 per cent for professional fees under 194J with a reduced 2 per cent for certain technical services, 2 per cent for plant and machinery rent and 10 per cent for land, building or furniture rent under 194I, 5 per cent for commission or brokerage under 194H, and 10 per cent for interest other than on securities under 194A. Select the description that fits your transaction and the rate follows.
Here is a real invoice. A consultant raises a bill of ₹1,50,000 for professional services, which falls under 194J at 10 per cent. TDS is 1,50,000 × 0.10 = ₹15,000, so the client pays ₹1,35,000 and deposits ₹15,000 against the consultant's PAN. The consultant claims that ₹15,000 as credit while filing their return. Contrast a contractor case: an ₹8,00,000 payment to an individual contractor under 194C attracts 1 per cent, so ₹8,000 is deducted and ₹7,92,000 paid. The same payment to a company attracts 2 per cent — ₹16,000 deducted, ₹7,84,000 paid. Identical work, different rate, purely because of the recipient's status.
The practical situations are these. A freelancer whose ₹1,50,000 invoice was settled at ₹1,35,000 can confirm the deduction was correct rather than assuming an accounting error. A company paying ₹60,000 monthly rent for an office deducts 10 per cent under 194I, so ₹6,000 goes to the government and ₹54,000 to the landlord. A business paying ₹40,000 in brokerage under 194H withholds ₹2,000. And a payer budgeting cash outflow needs both figures, because the TDS still leaves the business — it just goes to the tax department instead of the vendor, and missing the deposit deadline attracts interest.
The rules this simplified model does not carry are worth knowing. Every section has a threshold below which nothing is deducted, so small one-off payments often attract no TDS at all, and applying a rate blindly to a payment under the limit means over-deducting from a vendor. If the recipient has not furnished a PAN, the rate rises to 20 per cent — on that ₹1,50,000 invoice that is ₹30,000 instead of ₹15,000. Rates also change with each budget, and surcharge or cess applies in specific cases such as payments to non-residents. Use this to estimate and to sanity-check a deduction someone else has made, then confirm the current rate and threshold before you actually deduct or file. It is not tax advice, and a chartered accountant should confirm anything with compliance consequences. Everything runs in your browser, so your payment details are never uploaded or stored.
