TDS refers to tax deducted at source of income itself. In the case of TDS on salary – The employers deduct the applicable taxes from your salary before paying you the same.
It is mandatory, and now you know why TDS is deducted from salary. However, you can always bring down the TDS amount by investing in schemes where the income tax authority provides tax exemptions.
You can easily avoid that possibility by investing in instruments that are eligible for tax deductions. For that, you would have to submit all the genuine documents to your employer so that you can claim the tax deductions as per Section 80C and other sections of the Income Tax Act, 1961.
The various options that you have in this regard may be enumerated as below:
1. PPF (Public Provident Fund)
2. NPS (National Pension System)
3. ULIP (unit-linked insurance plans)
4. Sukanya Samriddhi Yojana
5. Tax-saving FDs (fixed deposits)
6. ELSS (equity-linked saving scheme) funds