TDS compliance is rarely top of mind when a startup is focused on product and growth — but it applies from the very first salary payment or vendor invoice, and early mistakes tend to compound as the team scales.
Many startups delay setting up proper TDS tracking until after the first few hires, by which point catching up on missed deductions and interest becomes far more work than setting up compliant software from the start. Getting this right early avoids months of retroactive correction later.
Yes — a TAN is required before TDS can be deducted and deposited, and should be obtained as soon as payroll or vendor payments are expected to begin.
Delaying TDS setup until after the first few payments, resulting in retroactive correction and potential interest on late deduction.
It becomes worthwhile as soon as there's more than a handful of employees or vendors, since manual tracking at that scale is where most early compliance gaps occur.
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