TDS Refund: Procedure for applying for Income Tax Refund

TDS Refund: Procedure for applying for Income Tax Refund

 

TDS is required to be deducted at the time of making any payment and the TDS so deducted is deposited with the Income Tax Department as tax deducted on behalf of the person to whom the payment is being made.

• Recommended Read: Rate of TDS to be deducted while making payments

The TDS so deducted is allowed to be claimed as a credit from the Income Tax Payable of the person whose TDS has been deducted. The Balance amount of tax shall be tax payable/tds refundable. This can be explained with the help of the following example:-

	Total Tax Payable by Mr A for the year 2013-14*	50000
(Less)	TDS deducted by Mr B while making payment to Mr A	-20000
(Less)	TDS deducted by Mr C while making payment to Mr A	-15000
	Balance Tax Payable by Mr A	15000

*The total tax payable would be the self assessment tax computed by the taxpayer himself by applying the income tax slab rates on his total income.

The Balance shall be the tax payable by Mr A which he would be required to pay before the due date of payment of income tax.

However, in case the TDS Deducted is more than the total tax payable, the excess amount deducted is allowed to be claimed as TDS Refund. This can be explained with the help of the following example

	Total Tax Payable by Mr A for the year 2013-14	40000
(Less)	TDS deducted by Mr B while making payment to Mr A	-25000
(Less)	TDS deducted by Mr C while making payment to Mr A	-20000
	TDS Refundable to Mr. A	5000

In the above case, as the Total TDS Deducted is more than the Total Tax payable for the year, the excess amount deducted shall be the TDS Refund which the income tax dept would be making to Mr. A