How does TDS work?
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TDS would apply to all taxable incomes except it’ll be deducted at source at a fixed rate. For almost all payments except salary, TDS rate depends on the type of income rather than the amount of payment.
In the case of salary, the employer can estimate the total expected income of the employee. Thus, TDS deduction happens at the applicable slab rate and may change in the middle of the year based on:
1. Changes to income due to bonus, appraisal
2. Submission of investment proof