Introduction
Figuring out how much TDS is deducted on salary in India can help you plan your finances better and avoid surprises in your paycheck. TDS, or Tax Deducted at Source, is not a set amount but depends on your income, tax regime, and deductions under Section 192 of the Income Tax Act. For FY 2025-26, Budget 2025 made changes to the new tax regime slabs, giving more relief to middle earners. In this guide, we’ll explain how much TDS is deducted on salary in India, including key factors, slabs, examples, and tips. Whether you’re a fresh graduate or a seasoned professional, knowing how much TDS is deducted on salary in India lets you claim refunds if overpaid. With simple steps, you can take control—let’s get started with TaxQue’s help for accurate calculations.
Factors That Decide TDS on Salary
How much TDS is deducted on salary in India isn’t random—it’s based on several things your employer considers. Your total yearly income, including basic pay, bonuses, and allowances, is the starting point. TDS starts if it crosses the basic exemption limit.
The tax regime you choose matters a lot. The new regime, now default, has fewer deductions but lower rates. You can switch to the old regime for more savings through investments. Deductions like house rent allowance (HRA), standard deduction (Rs. 75,000 in new, Rs. 50,000 in old), or Section 80C (up to Rs. 1.5 lakh in old) cut your taxable amount. Rebates under Section 87A (up to Rs. 25,000 if income below Rs. 7 lakh in new regime) can make your tax zero.
Employers estimate using your Form 12BB declarations, but final checks happen in ITR. No TDS if below Rs. 3 lakh (new) or Rs. 2.5 lakh (old regime).
Income Tax Slabs for TDS Calculation
TDS follows income tax slabs, plus 4% cess and surcharge for high incomes over Rs. 50 lakh. Here’s the update for FY 2025-26.
New Tax Regime (Default Option)
Simpler with limited deductions, ideal if you have few investments.
| Income Slab (Rs.) | Tax Rate |
|---|---|
| 0 – 4,00,000 | Nil |
| 4,00,001 – 8,00,000 | 5% |
| 8,00,001 – 12,00,000 | 10% |
| 12,00,001 – 16,00,000 | 15% |
| 16,00,001 – 20,00,000 | 20% |
| 20,00,001 – 24,00,000 | 25% |
| Above 24,00,000 | 30% |
Old Tax Regime (Choose If Beneficial)
Allows more deductions like home loans.
| Income Slab (Rs.) | Tax Rate |
|---|---|
| 0 – 2,50,000 | Nil |
| 2,50,001 – 5,00,000 | 5% |
| 5,00,001 – 10,00,000 | 20% |
| Above 10,00,000 | 30% |
Budget 2025 raised the new regime’s nil slab to Rs. 4 lakh, saving up to Rs. 17,500 for many.
Step-by-Step TDS Calculation Example
Let’s see how much TDS is deducted on salary in India with an example. Suppose your yearly salary is Rs. 10 lakh in the new regime, with Rs. 75,000 standard deduction and no others.
- Taxable income: Rs. 10,00,000 – Rs. 75,000 = Rs. 9,25,000.
- Tax breakdown: Nil on Rs. 4,00,000; 5% on Rs. 4,00,000 (Rs. 20,000); 10% on Rs. 1,25,000 (Rs. 12,500). Total tax: Rs. 32,500 + 4% cess (Rs. 1,300) = Rs. 33,800.
- Monthly TDS: Around Rs. 2,817, spread over 12 months with adjustments for bonuses.
In old regime with Rs. 1.5 lakh 80C deduction: Taxable Rs. 8,00,000; tax Rs. 72,500 + cess. Switch if it lowers TDS. Use TaxQue’s calculator for your case.
Ways to Reduce TDS Deductions
You can lower how much TDS is deducted on salary in India by planning ahead:
- Share investment proofs mid-year via Form 12BB to adjust estimates.
- Pick the regime that fits—new for simplicity, old for deductions.
- Claim HRA if renting, or other allowances like LTA.
- For low income, no TDS applies; inform employer.
Seniors get higher limits, like Rs. 3 lakh nil in old regime for 60+.
Claiming Refunds if TDS is Over-Deducted
If too much is deducted, file ITR by July 31, 2026, for AY 2026-27. Match Form 16 with Form 26AS, e-verify, and get refund with 0.5% interest if delayed under Section 244A. TaxQue helps file and track.
Frequently Asked Questions (FAQs)
How much TDS is deducted on salary in India under the new regime?
It depends on slabs: nil up to Rs. 4 lakh, then 5-30%. For Rs. 10 lakh with standard deduction, about Rs. 33,800 yearly, or Rs. 2,817 monthly.
Can I reduce how much TDS is deducted on salary in India?
Yes, declare deductions early via Form 12BB. Choose old regime for more savings if you have investments like 80C.
What if no TDS is deducted but I owe tax?
Pay the difference when filing ITR. Use TaxQue to calculate how much TDS is deducted on salary in India accurately.
How do I claim refund for excess TDS on salary?
File ITR, verify with Form 26AS. Get interest if delayed. This answers if over-deduction happens in how much TDS is deducted on salary in India.
Are there changes in TDS on salary for 2025?
Yes, new regime nil slab to Rs. 4 lakh, rebate up to Rs. 25,000 under Rs. 7 lakh. Affects how much TDS is deducted on salary in India.
Conclusion
Understanding how much TDS is deducted on salary in India helps you budget and claim what’s yours. With 2025 updates like better slabs and rebates, many will see lower deductions. Share details with your employer, choose the right regime, and file ITR for refunds. Tools like TaxQue make it simple to calculate and comply. Plan smart, track your slips, and keep more of your hard-earned money this year.
