Top Bird

The first thing you have to understand about your Cockatiel is that he thinks he's the boss. He assumes from day one that he is in charge, and you are most likely unknowingly reinforcing this belief. For example, having your bird sit on your shoulder is a sign that your Cockatiel is the dominant one in your relationship. Why? Because in the wild, the flock leader is the one who sits highest in the tree, and being on your shoulder makes him feel that he is above you. That's why many birds will bite when you attempt to take them off your shoulder, you are forcibly removing them from a place of dominance. Instead, you should keep your bird in your lap until they learn that they are not the boss, and biting is a bad thing. Once they understand that, then you can allow them back onto your shoulder for as long as they behave.

Time Out

When your Cockatiel misbehaves you need to punish them. However, this can be tricky. Physically hitting your bird, by flicking them on their nose trains them to be scared of your hand. On the other hand putting them back in their cage is also a bad idea because; A) Their cage isn't suppose to be a bad place that they fear, and B) they will learn that if they want to go home all they have to do is bite you.
Instead the best thing to do is to get a large box to put them in, something large enough for them to move around in, but lacking any form of entertainment such as toys. This will be their time out box. This works well as a punishment because birds are very sociable creatures, and being isolated in a box where they can't see anyone will make the box a dreaded place for your Cockatiel. However you should leave the lid off if your birds wing are clipped, or have a lid with proper ventilation and that is see through, after all, being in the dark is a bit to cruel of  a punishment.

Be Tough, But Fair

Who would you respect and listen to more, a boss who screams incoherently at you, or a boss who will be stern and rationally punish you when you screw up, but without going ballistic. Most likely you said the boss who's stern, but calm, right? Well, birds aren't going to be any different. When your Cockatiel tries to bite you, you should give them a stern, but calm warning such as "No", followed by punishment in the time out box if they still bite you. Don't start screaming at them, and don't vary the warning word. Eventually, your bird will associate the warning with the punishment and will stop whatever behavior they were doing in order to avoid going in the box. 
When he stops the bad behavior at the warning word, it really helps to switch over to positive reinforcement by giving them a treat.

Learn More

These are some of the basics of training your pet Cockatiel not to bite. And with time and consistency you should be able to succeed. However, if you want more great ways to train them, and to speed the process up, then I recommend you check out This Site. They offer a variety of great information on training Cockatiels and other parrots!