Difference Between TDS and TCS
5paisa Research Team
Last Updated: 25 Sep, 2023 06:58 PM IST

Content
- Introduction
- What Is TDS?
- What is TCS?
- Example Of TDS and TCS
- Comparison of TDS and TCS
- Effects of Failing To Deposit TDS and TCS
- Conclusion
Introduction
There are numerous factors involved in the Indian tax system, the Income Tax Act of 1961 defines these factors through various terminology. Two of the most common terms used to define certain factors in the tax system are TDS and TCS. However, there are times when people use both terms interchangeably, confusing other taxpayers about the applicability of both terms while paying taxes.
If you are an Indian taxpayer or have increased your salary to come under the tax slab, it is important to understand the difference between TDS and TCS to ensure effective compliance with the income tax law.
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Frequently Asked Questions
You can pay TDS and TCS using the official online portal created by the Income Tax Department. If you want to pay TDS and TCS offline, download and submit Challan 281 to any authorised bank.
No, as per Section 206 C (1H), the government doesn’t allow the collection of TCS if the buyer is liable to pay TDS.
If an individual fails to deposit tax, the Income Tax Department may levy a fine or charge interest on the late payment. It can also lead to seven years of imprisonment.
TDS (Tax Deducted at Source) on salary is a type of tax deduction applicable to employed individuals who receive a salary from their employer. Under this system, the employer deducts a certain percentage of the employee's salary as income tax before paying the employee.