TDS or tax deducted at source is a type of tax, that, as the name suggests is deducted at source. Here the tax is deducted on a percentage of your income like professional fees or interest. Under section 194A, TDS is deducted on interest payable like interest on fixed deposits (FDs) and interest paid on unsecured loans. For example, in the case of FDs, interest income is taxable if the interest exceeds Rs 40,000 for citizens below the age of 60 and Rs 50,000 for senior citizens. TDS is deducted at the rate of 10 per cent. However, if you have not provided your Permanent Account Number (PAN) details to the bank, TDS will be deducted at 20 per cent. Remember TDS is deducted as long as the interest is credited to their account irrespective of whether the customer withdraws it or not.