Benefits of TDS
TDS refers to tax deduction at source and it implies that prior to getting your income or salary, the necessary sum of tax is subtracted from it. For a TDS collection, two main parties are normally involved including the payee and government.
1. Simple to use
TDS is a simple method of tax collection. The calculation for all the workers can be performed in a simple and fast manner with the assistance of the various tax calculators accessible online. The online tax calculators are simple to use and cost effective as well. As they do not involve paper work, they save lots of time. Moreover, since all the calculations are computerized, employers do not have to worry about errors or miscalculations.
2. Hassle free
TDS offers an avenue in which an individual can make tax payments each month, such that an equal sum is deducted all through the year. This prevents the hassle linked to depositing large sums of money or even missing tax payments. In addition, employees can calculate the sum of their expenses after considering the tax that has been deducted so as to obtain tax rebates. There are also no hassles associated with standing in long queues so as to fill forms since all of this will be performed by the employing companies.
3. Better budgeting
Each month a standard amount of money is subtracted from the income of an employee in the TDS system. This means the employee is aware of the amount of salary he will get each month. This will allow such a person to plan his money accordingly. By subtracting the tax every month, a person can use all his money without worrying later on about paying for his tax if it had not been deducted.
Lastly, TDS benefits the government since it guarantees timely tax payment from people who earn salaries.