A deduction is a subtraction of something. An expenditure that an individual or corporation may remove from their gross income on their tax return is deduction. Deductions as taxes reduce the taxable income(s), lowering the tax liability of an individual or business that has to be given to the state. However, the tax credit must not be misunderstood as a deduction: the credit decreases the taxable amount due, whereas deduction(s) lower the level of taxable income(s).
Also, the cash taken from an employee's salary by the company comes under deductions as well. It should not be misunderstood with withholding because withholding is the country's taxes subtracted from an employee's salary. Whereas deductions are figures deducted from a worker's salary for various reasons, including retirement benefits, medical expenses, and special funds and charities.