TDS on Salary Calculator (Section 192)

Calculate the exact income tax deducted at source (TDS) from your monthly salary based on your investment declarations and chosen tax regime.

Sec 192 Rules | FAQs

Income Details

Include Basic, HRA, and all allowances. (Before PF deduction).

E.g., Bank FD Interest, Rental Income.

Regime & Declarations

New regime ignores most deductions but has lower slabs.

Monthly TDS Deduction

₹0

This amount is withheld from your salary every month by your employer.

Annual Salary Projection

Gross Annual Salary ₹0
Add: Declared Other Income ₹0
Less: Standard Deduction - ₹75,000
Net Taxable Income ₹0

Annual Tax Liability

Income Tax Base ₹0
Rebate 87A - ₹0
Health & Edu Cess (4%) ₹0
Total Annual Tax ₹0

Total Annual Tax ÷ 12 months = Monthly TDS.

Gross Monthly vs Take Home

Excluding PF/PT deductions, your post-tax monthly cashflow is:

₹0

How Employers Calculate TDS (Section 192)

Under Section 192 of the Income Tax Act, any employer paying a salary is legally mandated to deduct income tax at source (TDS) at the time of payment. The employer does not deduct a flat percentage; instead, they project your annual income, calculate the applicable tax slab, and divide the total tax by 12 months.

The Calculation Flow

1. Annual Projection Monthly Salary × 12 = Projected Annual Salary.
2. Subtract Exemptions Standard Deduction (₹75,000 for New Regime / ₹50,000 for Old Regime) is removed. If you opted for the Old Regime, HRA and LTA exemptions based on your rent receipts and travel bills are also removed.
3. Apply Deductions If in Old Regime, Section 80C (PPF, ELSS) and 80D (Health Insurance) declarations are subtracted to find the Net Taxable Income.
4. Tax & TDS Tax is calculated on the Net Income based on the applicable slab. Cess of 4% is added. The total is divided by 12 to find your monthly TDS deduction.

The "March TDS Shock"

At the start of the year (April), you make an "Investment Declaration" to your HR stating you will invest ₹1.5L in 80C. Your HR calculates your monthly TDS assuming you actually make this investment.

In Jan/Feb, you must submit actual proof (receipts) of these investments. If you failed to invest the promised amount, the HR recalculates your tax without the deduction. The sudden shortfall in tax collected is recovered entirely from your Feb/March salary, leading to a massive drop in your in-hand pay.

Frequently Asked Questions

1. What is Section 192 of the Income Tax Act?
Section 192 mandates employers to deduct Tax at Source (TDS) on the estimated annual salary of an employee at the time of paying the monthly salary. The TDS is based on the average rate of income tax computed on the basis of the applicable slab rates.
2. How does the employer calculate monthly TDS?
The employer projects your total annual salary, adds any other income you declared, subtracts standard deduction (₹75,000 for New Regime / ₹50,000 for Old Regime) and other declared investments (like 80C, HRA). The total tax liability is calculated on this net income. This total tax is then divided by 12 to determine the monthly TDS deduction.
3. What if I don't declare investments to my employer?
If you are in the Old Tax Regime and fail to declare investments (like LIC, PPF, Rent receipts) to your employer, they will deduct higher TDS. However, you can still claim these deductions while filing your ITR and get a refund of the excess TDS deducted.
4. Is Standard Deduction available in the New Tax Regime?
Yes. Under Budget 2025, the standard deduction for the New Tax Regime has been increased to ₹75,000 for FY 2025-26. Under the Old Tax Regime, it remains ₹50,000.
5. Why is my TDS changing in March?
Employers do a final tax reconciliation in Feb/March. If you did not submit proof of the investments you declared at the start of the year, your tax liability increases, resulting in a heavy TDS deduction in your final months' salary.
6. How do I choose between Old and New Regime for TDS?
At the beginning of the financial year, you must inform your employer about your preferred tax regime. If you do not intimate them, they are legally mandated to deduct TDS based on the New Tax Regime (which is the default).
7. Does this tool calculate PF and Professional Tax?
This specific calculator focuses purely on the Income Tax (TDS) component to show you how much tax is eaten from your salary. Actual 'in-hand' salary will also have PF (usually 12% of basic) and Professional Tax (~₹200/month) deducted.
8. How do I get proof of my TDS deductions?
Your employer is required to issue you a Form 16 (Part A & B) annually, which details your exact salary paid and the TDS deposited to the government against your PAN. You can also check your Form 26AS or AIS on the income tax portal.

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