Why is my TDS much higher in January to March?

Usually because investment proofs were not submitted or were less than declared, or because a bonus or hike raised the estimated annual tax. The employer must collect the whole year's tax by March, so any shortfall lands in the last months.

Can I change my regime for TDS in the middle of the year?

Employers generally take the regime choice once at the start of the year and apply it for all of that year's TDS. You can still choose the other regime when you file your return.

If my employer deducts TDS, do I still need to file a return?

Yes, if your income is above the basic exemption limit. TDS is only an advance payment. The return reports all income and settles the final tax, and is the only way to get a refund.

Is TDS deducted if my salary is ₹12 lakh?

No, not in the new regime. After the ₹75,000 standard deduction, taxable income is ₹11,25,000, within the ₹12 lakh rebate limit, so the tax and the TDS are nil.

TDS on salary: how your employer deducts tax

Updated 11 October 2026

TDS on salary is the income tax your employer deducts from your pay every month and deposits with the government on your behalf. The employer estimates your tax for the whole year and spreads it over the months left. From tax year 2026-27 this is governed by section 392 of the Income-tax Act, 2025, which replaced section 192 of the 1961 Act.

How your employer calculates it

Estimates your gross salary for the whole year, including expected bonus and perquisites.
Applies the regime you chose. If you said nothing, the new regime is used.
Subtracts the standard deduction and, in the old regime, the exemptions and deductions you declared.
Works out the year's tax with slabs, rebate and cess.
Subtracts TDS already deducted this year and divides the rest by the months remaining.

Because the figure is re-estimated whenever something changes, your monthly TDS can rise or fall during the year.

Telling your employer your regime and investments

At the start of the year your employer asks which regime you want for TDS. This choice generally holds for the whole year's TDS, but it does not bind you when you file: salaried people can still choose either regime in the return.

If you pick the old regime, you declare your planned rent, investments and loans so they can be taken into account. Under the Income-tax Rules, 2026 the declaration is Form 124, which replaced Form 12BB. Around January or February, employers ask for proof: rent receipts (with the landlord's PAN if annual rent is above ₹1 lakh), 80C investment proofs, the home loan interest certificate and health insurance receipts. If proof is missing, the employer recalculates and deducts more in the last months.

Worked example: a mid-year salary hike

Worked example. Divya's salary is ₹1,25,000 a month (₹15,00,000 a year) and she uses the new regime.
Estimated tax = ₹97,500 (taxable ₹14,25,000: ₹20,000 + ₹40,000 + ₹33,750 = ₹93,750, plus ₹3,750 cess). Monthly TDS = ₹97,500 ÷ 12 = ₹8,125.
From October her salary rises to ₹1,50,000 a month. Revised annual salary = ₹1,25,000 × 6 + ₹1,50,000 × 6 = ₹7,50,000 + ₹9,00,000 = ₹16,50,000.
Revised taxable income = ₹16,50,000 − ₹75,000 = ₹15,75,000. Tax = ₹60,000 + 15% of ₹3,75,000 (₹56,250) = ₹1,16,250, plus cess ₹4,650 = ₹1,20,900.
Already deducted April to September = ₹8,125 × 6 = ₹48,750. Balance ₹72,150 over six months = ₹12,025 a month from October.

If you change jobs

Your new employer does not know what you earned earlier in the year. Unless you give details of your earlier salary and TDS, each employer may allow the full standard deduction, the lower slabs and even the rebate, so too little tax is deducted overall. You then owe the difference when you file. Give your new employer the salary and TDS figures from the previous job (the old rules used Form 12B for this; HR will tell you the current form).

Other income and TDS

You can ask your employer to take other income, such as interest, into account so that TDS covers it, and, in the old regime, to adjust TDS for a loss under the head house property, such as home loan interest, within the limits. This avoids a large bill or advance tax later. If you have other income and do not do this, check whether you need to pay advance tax.

Deposit, quarterly statement and certificate

The employer deposits the deducted tax with the government against your PAN.
Every quarter it files a TDS statement for salary, Form 138 under the 2026 Rules (Form 24Q earlier).
After the year it issues a TDS certificate: Form 130 for tax year 2026-27, due by 15 June 2027 (Form 16 for 2025-26).
You can check every rupee credited against your PAN in Form 26AS and the Annual Information Statement on the e-filing portal. See Form 26AS and AIS.

Special cases

No TDS if income is below the taxable limit. If your estimated salary is within the rebate (₹12.75 lakh salary in the new regime), no tax is deducted.
No PAN: if tax is deductible and you have not given your PAN, the employer must deduct at a higher rate, generally at least 20%.
Pensioners: the bank or office that pays your pension deducts TDS in the same way, after the standard deduction.
Arrears: salary arrears are taxed in the year received; you can claim relief under section 157 (section 89 earlier). See relief on arrears.

Estimate your monthly TDS with the income tax calculator, and see how it affects take-home pay in the salary calculator.