TDS Interest Calculator

About the TDS Interest Calculator

Tax Deducted at Source (TDS) is India's mechanism for collecting income tax at the point of payment. When you receive interest, rent, professional fees, commission, or other specified income above threshold limits, the payer deducts TDS before paying you the net amount and deposits it with the government on your behalf.

TDS rates vary by section and financial year. This calculator includes common reference sections such as bank interest, rent, and professional fees, but the threshold and rate must still be checked against the rule set in force for the relevant year. If the payee does not provide a PAN, a higher fallback rate can apply — making PAN submission critical.

Late TDS deposits attract statutory interest, and late filing of TDS returns can also trigger fees. This calculator estimates the TDS amount, interest on delayed deposits, and common section logic, but you should verify the applicable threshold, rate, and filing period for the relevant financial year before remitting or filing.

When This Page Helps

TDS compliance involves multiple sections, rates, thresholds, and penalties. Wrong calculations lead to short deduction or excess deduction. Use this calculator to model the payment and delay math, then confirm the live section rules before filing or remitting.

How to Use the Inputs

1. Select the applicable TDS section based on payment type.
2. Enter the payment amount.
3. Indicate whether the payee has submitted PAN (affects rate).
4. Select senior citizen status if the applicable section uses a different threshold for that case.
5. If applicable, enter months of delay for interest calculation.
6. Review the section reference table for all major TDS rates.

Example Calculation

Tips & Best Practices

• Always submit Form 15G/15H if your total income is below the taxable limit — this prevents TDS deduction entirely.
• Without PAN, TDS is deducted at 20% instead of the section rate — ensure PAN is submitted to all deductors.
• Senior citizens (60+) get a higher threshold of ₹50,000 for bank interest under Section 194A.
• TDS on rent exceeds ₹6,00,000/year in this annualized model of Section 194I — split rent across family members if each owns a share where the law permits it.
• File Form 26AS to verify all TDS deducted on your behalf matches what was actually deposited.
• Late TDS deposit interest is 1.5% per month — even one month late on a large amount costs significantly.

Practical Guidance

Use the section-specific rate and threshold for the relevant financial year, then verify the PAN status and deposit timing before filing.

Common Pitfalls

Most mistakes come from using the wrong section, assuming a stale threshold, or forgetting that late-deposit interest and late-filing fees are separate charges. Treat the page as a reference model and recheck the actual return period before using the result in compliance work.

Frequently Asked Questions

• What is TDS and who deducts it?

  TDS (Tax Deducted at Source) is tax collected by the payer at the time of making specified payments (interest, rent, salary, professional fees, etc.). Banks deduct TDS on interest, tenants when rent thresholds are crossed, and businesses on contractor or professional payments. The deducted amount is deposited with the government and credited to the payee's tax account.

• What happens if PAN is not provided?

  If the payee does not furnish their PAN, TDS must be deducted at 20% or the prescribed section rate, whichever is higher. Since most section rates are below 20%, not providing PAN effectively doubles or triples the TDS amount. This is governed by Section 206AA of the Income Tax Act.

• How can I avoid TDS on interest income?

  Declarations such as Form 15G or 15H may prevent TDS deduction when you meet the eligibility rules for the relevant financial year. Confirm the current exemption-limit and declaration requirements before relying on that outcome.

• What is the interest on late TDS deposit?

  There are two types: (1) Interest at 1% per month for late deduction (from due date to actual deduction date), and (2) Interest at 1.5% per month for late deposit (from deduction date to actual deposit date). Both are calculated on the TDS amount and are mandatory.

• What is Section 234E penalty?

  A late filing fee of ₹200 per day is charged for each day of delay in filing TDS returns (Form 24Q, 26Q, etc.). The fee is capped at the total TDS amount in the return. For example, if TDS of ₹10,000 and the return is 30 days late, the fee is ₹6,000 (30 × ₹200, which is less than ₹10,000).

• How do I claim TDS credit?

  TDS deducted on your income is reflected in Form 26AS (Annual Tax Statement). When filing your Income Tax Return, you claim credit for all TDS amounts, which reduce your total tax liability. Any excess TDS over your actual tax is refunded by the Income Tax Department.