A Quick Guide On TDS And How It Works Tax Deducted at Source (TDS) Is Used To Collect Taxes Directly From The Source TDS Is Levied On Different Income Sources Like Salary, Commissions, Etc TDS Rates Vary Depending On Nature Of Income And Tax Norms Helps Ensure Timely Tax Collection And Reduces Evasion TDS Deductions Affect Cash Flow And Potential Errors In Calculation Reduce Efficiency