TDS/TCS is to be deducted as per the provisions of Income Tax Act, 1961. Following Links will give the details.: The rate at which TDS/TCS is to be deducted/collected The sections which are applicable and other details for deduction/collection of TDS/TCS.
Gautham, since u r not specific on TDS/TCS on which services or items, I can answer u only generally. Income tax provides for the specified amounts which is the set limit for TDS calculation. If the amount of payment exceeds the limit, then only TDS has to be deducted. But remember, this limit is just decisive on TDS to be deducted or not i.e. if amount of payments exceeds the specified limit as given in the section even by Re. 1 then, TDS has be deducted on the whole of the amount. The rate at which TDS has to be deducted has been specified. So after deciding carefully, in which category the case falls, TDS should be calculated. Exactly same concept applies to TCS except where receiver of the amount has to collect tax from the payer.