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INTRODUCTION
To reduce the cost of recovery of Income Tax and to avoid evasion of tax, the Income Tax Act has made
provisions of collecting tax at the source of income. Under this scheme the payer of the income has to
deduct the amount of tax from the income of the payee and has to pay only net amount to the payee which
is after the deduction of tax. Further the person who has deducted the amount of tax has to deposit it with
the central government within a stipulated time period. The payee of income gets only net amount after
TDS. From his/her income tax liability, the amount which has been deducted has to be reduced and only
balance amount has to be paid or deposited with central government.