TDS Calculator on Salary 2026

Under Section 392 (Section 192 of the 1961 Act), your employer projects your gross salary for the entire financial year, subtracts applicable deductions (standard deduction, HRA, Section 80C/80D under Old Regime), calculates income tax according to the active slab rates, and divides the total annual tax by 12 to compute monthly TDS.

Your employer starts deducting once your projected annual tax for the year is more than zero. Under the New Regime a gross salary up to ₹12,75,000 attracts no tax — ₹12,00,000 of taxable income after the ₹75,000 standard deduction — because the Section 87A rebate of ₹60,000 wipes out the tax due. Gross salary excludes employer PF and gratuity, so with basic at 50% that is a CTC of about ₹13.9 lakh. Under the Old Regime the equivalent point is ₹5,00,000 of taxable income, where the rebate is ₹12,500. Go ₹5 above those lines (taxable income is rounded to the nearest ₹10) and TDS begins, spread across the remaining months of the year.

Form 130 is the annual TDS certificate your employer issues for your salary. It replaced Form 16 from 1 April 2026 under the Income-tax Rules, 2026, so you may still hear it called Form 16. It provides a complete breakdown of total salary paid, tax deductions claimed, and total TDS deposited with the Income Tax Department.

Yes! If excess TDS was deducted (for instance, if you submitted tax-saving investment proofs late), you can claim a full refund along with interest by filing your Income Tax Return (ITR-1 / ITR-2) on the IT Portal.

Starting FY 2023-24 onwards, the New Tax Regime is the default tax regime under Section 115BAC. If you do not formally communicate your choice to your employer, TDS will automatically be deducted according to the New Tax Regime slabs.

Use Form 12BAA, notified in October 2024 under Rule 26B. It lets a salaried employee report TDS and TCS already suffered on other income — bank interest, dividends, a car purchase, a foreign remittance — so the employer can reduce salary TDS under Section 192(2B) instead of your waiting for a refund. Other income itself is declared the same way and will increase your TDS. A house property loss is the only head your employer may set off against salary.

Credit under Section 199 follows what the deductor reports in its quarterly TDS return, so a deduction that was never deposited or was filed against a wrong PAN will not appear in Form 26AS or the AIS. Ask your employer to file or correct the TDS statement, and keep your payslips and Form 130 (earlier Form 16) as proof of deduction. Section 205 bars the department from recovering that tax from you again, but in practice the return is processed on 26AS, so get the statement fixed before you file.