Ever wondered why your in-hand salary is less than your offer letter, or why the bank paid you slightly less FD interest than the rate promised? That missing slice is TDS, and understanding it is the key to getting refunds.
How TDS works
Instead of trusting everyone to pay tax at year end, the law makes the payer deduct tax upfront: your employer on salary, banks on interest above thresholds, clients on professional fees at 10%, even property buyers on big purchases. The deducted amount goes to the government against your PAN, and appears in your Form 26AS as credit.
TDS is prepaid tax, not final tax
This is the part people miss. TDS is an advance, not a bill. At filing time you compute your actual tax and subtract all TDS already paid. Deducted more than you owe? The difference comes back as a refund. Deducted less? You pay the balance. Filers who skip filing because 'TDS was already cut' routinely leave thousands of rupees of refund unclaimed.
Classic refund situations
- ✓Your income is below taxable limits but the bank still cut TDS on FD interest
- ✓A freelancer's clients cut 10% but presumptive taxation makes actual tax lower
- ✓You changed jobs and both employers over deducted
Saathi.Tax pulls your TDS picture together from Form 16 and your entries, sets it against your computed tax, and shows your refund before you pay us anything. Money you already earned should come home.
