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Answer Posted / amitagrawal
Tds means tax deducted at source.
It means tax is deducted by payer at the time of making
payment to payee.
For example Life insurance corporation of india while
paying commission to its agents then it will deduct some
percentage of tax out of their claim. and LIC will deposit
this to the government.
There are different rates of TDS depending on the type of
payments.
ex. Commission, interest, winnings from lottery etc.,
interest on securities etc.
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