TDS

# TDS

Tax deducted at source (TDS) is tax you take out of a payment before you pay the person. You then deposit it with the government and report it in a quarterly statement.

Common sections

The section depends on what you pay for. The section numbers below are from the Income-tax Act, 1961, which applies to payments made before 1 April 2026. From that date the Income-tax Act, 2025 applies, and its provisions have new numbers. Do not use the numbers below for payments made from that date. Check the current chart on incometax.gov.in. Some examples under the 1961 Act:

• 194C: payments to contractors
• 194J: professional or technical fees
• 194H: commission or brokerage
• 194I: rent
• 194A: interest other than on securities

Rates differ by section, and by whether the payee has a PAN. Check the current rate chart on incometax.gov.in before each payment. Rates change in most years.

Recording a deduction

1. Record the bill or payment at the full amount.
2. Record the TDS deducted as a liability, such as a TDS payable account, not as an expense.
3. When you deposit it, pay from the bank and clear the liability.

Pop Books does not calculate or deduct TDS for you. Pop Books doesn't file TDS returns. Work out the deduction yourself, or ask your accountant.

Deposit dates

TDS is generally deposited by the 7th of the month after the deduction. For a March deduction the date is later. Check the due dates on incometax.gov.in each year.

Quarterly statements

TDS is reported each quarter in the statement for the type of payment:

• Form 26Q for payments other than salary, to residents
• Form 24Q for salary
• Form 27Q for payments to non-residents

Keep the challan (payment proof) and the PAN of each person you deducted from. Quarterly due dates are on incometax.gov.in.