TDS-Tax Deduction at Source
Applicability, TDS Rate Chart, Return Filing with Due Dates
1. About TDS:-
A person (deductor) who is liable to make payment of specified nature to any other person (deductee) shall deduct tax at source and remit the same into the account of the Central Government. The deductee from whose income tax has been deducted at source would be entitled to get credit of the amount so deducted on the basis of Form 26AS or TDS certificate issued by the deductor.
2. How to pay Tax Deducted/Collected at source:-
Tax deducted or collected at source shall be deposited to the credit of the Central Government by following modes:
1) Electronic mode: E-Payment is mandatory for
a) All corporate assesses; and
b) All assesses (other than company) to whom provisions of section 44AB of the Income Tax Act, 1961 are applicable.
2) Physical Mode: By furnishing the Challan 281 in the authorized bank branch
3. Rates for deduct of tax at source:-
Taxes shall be deducted at the rates specified in the relevant provisions of the Act or the First Schedule to the Finance Act. However, in case of payment to non-resident persons, the withholding tax rates specified under the Double Taxation Avoidance Agreements shall also be considered
|
Section |
Deductee* |
Nature of transaction |
Threshold Limit (Rs) |
TDS Rate |
|
192 |
R, NR |
Payment of salary |
Basic exemption limit of employee |
Normal Slab Rates |
|
192A |
R, NR |
Premature withdrawal from EPF |
50,000 |
10% |
|
193 |
R |
Interest on securities |
Debentures- 5,000 |
10% |
|
8% Savings (Taxable) Bonds 2003 or 7.75% Savings (Taxable) Bonds 2018- 10,000 |
||||
|
Other securities- No limit |
||||
|
194 |
R |
Payment of any dividend |
5,000 |
10% |
|
194A |
R |
Interest from other than interest from securities(from deposits with banks/post office/co-operative society) |
Senior Citizens- 50,000
|
10% |
|
Others- 40,000 |
||||
|
194A |
R |
Interest from other than interest on securities u/s 193 and interest from banks/post office/co-operative society.
|
5,000 |
10% |
|
For e.g., interest from friends and relatives |
||||
|
194B |
R, NR, FC |
Income from lottery winnings, card games, crossword puzzles, and other games of any type |
10,000 |
30% |
|
194BB |
R, NR, FC |
Income from horse race winnings |
10,000 |
30% |
|
194C |
R |
Payment to contractor/sub-contractor:-
|
Single transaction- 30,000
|
1% |
|
Individuals/HUF |
Aggregate transactions- 1,00,000 |
|||
|
194C |
R |
Payment to contractor/sub-contractor:-
|
Single transaction- 30,000
|
2% |
|
Other than Individuals/HUF |
Aggregate transactions- 1,00,000 |
|||
|
194D |
R |
Insurance commission to domestic companies |
15,000 |
10% |
|
194D |
R |
Insurance commission to other than companies |
15,000 |
5% |
|
194DA |
R |
Income for the insurance pay-out, while payment of any sum in respect of a life insurance policy. |
1,00,000 |
5% |
|
194E |
NR, FC |
Payment to non-resident sportsmen/sports association |
No limit |
20% |
|
194EE |
R, NR |
Payment of amount standing to the credit of a person under National Savings Scheme (NSS) |
2,500 |
10% |
|
194F |
R, NR |
Payment for the repurchase of the unit by Unit Trust of India (UTI) or a Mutual Fund |
No limit |
20% |
|
194G |
R, NR, FC |
Payments, commission, etc., on the sale of lottery tickets |
15,000 |
5% |
|
194H |
R |
Commission or brokerage |
15,000 |
5% |
|
194-I |
R |
Rent on |
2,40,000 |
2% |
|
plant and machinery |
||||
|
194-I |
R |
Rent on |
2,40,000 |
10% |
|
land/building/furniture/fitting |
||||
|
194-IA |
R |
Payment in consideration of transfer of certain immovable property other than agricultural land. |
50,00,000 |
1% |
|
194-IB |
R |
Rent payment by an individual or HUF not covered u/s. 194-I |
50,000 per month |
5% |
|
194-IC |
R |
Payment under Joint Development Agreements (JDA) to Individual/HUF |
No limit |
10 |
|
194J |
R |
Any sum paid by way of fee for professional services |
30,000 |
10% |
|
194J |
R |
Any sum paid by way of remuneration/fee/commission to a director |
30,000 |
10% |
|
194J |
R |
Any sum paid for not carrying out any activity concerning any business; |
30,000 |
10% |
|
194J |
R |
Any sum paid for not sharing any know-how, patent, copyright, etc. |
30,000 |
10% |
|
194J |
R |
Any sum paid as a fee for technical services |
30,000 |
2% |
|
194J |
R |
Any sum paid by way of royalty towards the sale or distribution, or exhibition of cinematographic films |
30,000 |
2% |
|
194J |
R |
Any sum paid as fees for technical services, but the payee is engaged in the business of operation of the call center. |
30,000 |
2% |
|
194K |
R |
Payment of any income for units of a mutual fund, for example, dividend |
No limit |
10% |
|
194LA |
R |
Payment in respect of compensation on acquiring certain immovable property |
2,50,000 |
10% |
|
194LB |
NR, FC |
Payment of interest on infrastructure debt fund to Non-Resident |
No limit |
5% |
|
194LC |
NR, FC |
Payment of interest for the loan borrowed in foreign currency by an Indian company or business trust against loan agreement or the issue of long-term bonds |
No limit |
5% |
|
194LC |
NR, FC |
Payment of interest for the loan borrowed in foreign currency by an Indian company or business trust against the issue of long-term bonds listed in IFSC |
No limit |
4% |
|
194LD |
NR, FC |
Payment of interest on bond (rupee-denominated) to FII or a QFI |
No limit |
5% |
|
194LBA(1) |
R |
Certain income distributed by a business trust to its unitholder |
No limit |
10% |
|
194LBA(2) |
NR, FC |
Interest income of a business trust from SPV distribution to its unitholders |
No limit |
5% |
|
194LBA(2) |
NR, FC |
Dividend income of a business trust from SPV, in which it holds the entire share capital exempt the capital held by the government, and distribution to its unitholders |
No limit |
10% |
|
194LBA(3) |
NR |
Rental income payment of assets owned by the business trust to the unitholders of such business trust |
No limit |
30% |
|
194LBA(3) |
FC |
Rental income payment of assets owned by the business trust to the unitholders of such business trust |
No limit |
40% |
|
194LBB |
R, NR |
Certain income paid to a unitholder in respect of units of an investment fund |
No limit |
10% |
|
194LBB |
FC |
Certain income paid to a unitholder in respect of units of an investment fund |
No limit |
40% |
|
194LBC |
R |
Income from investment in securitisation fund received to an individual and HUF |
No limit |
25% |
|
194LBC |
R |
Income from investment in securitisation fund received to a domestic company |
No limit |
10% |
|
194LBC |
FC |
Income from investment in securitisation fund received to a foreign company |
No limit |
40% |
|
194LBC |
NR |
Income from investment in securitisation fund received to NRI |
No limit |
10% |
|
194M |
R |
Certain payments by Individual/HUF not liable to deduct TDS under Section 194C, 194H, and 194J |
50,00,000 |
5% |
|
194N |
R, NR |
Cash withdrawal exceeding a certain amount |
1 crore |
2% |
|
194N |
R, NR |
Cash withdrawal in case person not filing ITR for last three years and the original ITR filing due date expired |
-20 lakh to 1 crore
|
2%
|
|
-1 crore |
5% |
|||
|
194O |
R |
Payment for the sale of goods or provision of services by the e-commerce operator through its digital or electronic facility or platform. |
5,00,000 |
1% |
|
194P |
R |
Payment of pension or interest to specified senior citizens of age 75 years or more |
Basic exemption limit of senior citizens or super senior citizens |
Normal tax slab rates |
|
194Q |
R |
Payments for the purchase of goods |
50,00,000 |
0.10% |
|
194R |
R |
Perquisite or benefit to a business or profession |
20,000 |
10% |
|
(Refer notes) |
||||
|
194S |
R |
TDS on the transfer of virtual digital assets |
Specified Persons- 50,000
|
1% |
|
(Refer notes)
|
||||
|
Others- 10,000 |
||||
|
195 |
NR |
Income on investments made by NRI citizen |
No limit |
20% |
|
195 |
NR |
Income by way of LTCG referred to in section 115E in the case of NRI |
No limit |
10% |
|
195 |
NR, FC |
Income by way of LTCG under section 112(1)(c)(iii) |
No limit |
10% |
|
195 |
NR, FC |
Income by way of LTCG under section 112A |
No limit |
10% |
|
195 |
NR, FC |
Income by way of STCG under section 111A |
No limit |
15% |
|
195 |
NR, FC |
Any other income by way of LTCG |
No limit |
20% |
|
195 |
NR, FC |
Interest payable on money borrowed by the government or Indian concern in foreign currency |
No limit |
20% |
|
195 |
NR, FC |
Income from royalty payable by the Indian concern or the government, for the copyright in a subject referred in the first proviso of section 115A or computer software referred to in the second proviso of section 115A |
No limit |
10% |
|
195 |
NR |
Income from royalty payable by government or Indian concern in pursuance of an agreement on matters included in the industrial policy |
No limit |
10% |
|
195 |
FC |
Income from royalty payable by government or Indian concern in pursuance of an agreement on matters included in the industrial policy
|
No limit |
50% |
|
If the agreement for such royalty payment is entered in between 31st March 1961 and 1st April 1976 |
||||
|
195 |
FC |
Income from royalty payable by government or Indian concern in pursuance of an agreement on matters included in the industrial policy
|
No limit |
10% |
|
If the agreement for such royalty payment is entered after 31st March 1976 |
||||
|
195 |
NR |
Income from technical fees payable by government or Indian concern in pursuance of an agreement on matters related to industrial policy |
No limit |
10% |
|
195 |
FC |
Income from technical fees payable by government or Indian concern in pursuance of an agreement on matters related to industrial policy
|
No limit |
50% |
|
If the agreement for such payment is entered in between 29th February 1964 and 1st April 1976 |
||||
|
195 |
FC |
Income from technical fees payable by government or Indian concern in pursuance of an agreement on matters related to industrial policy
|
No limit |
10% |
|
If the agreement for such payment is entered after 31st March 1976 |
||||
|
195 |
NR |
Any other income |
No limit |
30% |
|
195 |
FC |
Any other income |
No limit |
40% |
|
196B |
NR, FC |
Income (including LTCG) from units of an offshore fund |
No limit |
10% |
|
196C |
NR, FC |
Income (including LTCG) from foreign currency bonds or GDR of an Indian company |
No limit |
10% |
|
196D |
NR, FC |
Income (excluding dividend and capital gain) from Foreign Institutional Investors. |
No limit |
20% |
*R - Resident, NR - Non Resident, FC - Foreign Citizen
4. Due Date of TDS payment:-
The Due date shall be 7th of the succeeding month except for the month of March which shall be 30th April.
5. Interest for Non-deduction / Non-payment Of TDS
The following are TDS default for which interest is payable –
- Person liable to deduct TDS does not deduct TDS at all.
- Person after deducting TDS fails to pay whole or part of the tax to the credit of the Government.
In case of the above failures, the provisions of Section 201 of the Income Tax Act are invoked and interest is payable as under:
-
Interest in case of non-deduction of TDS – Interest shall be levied @1% for every month or part of the month from the date on which TDS was deductible till the date on which TDS actually deducted.
-
Interest in case of non-payment / late payment of TDS – Interest shall be levied @1.5% for every month or part of the month from the date on which TDS was deducted till the date on which TDS was actually credited to the Government.
6. Penalty For Non-deduction / Non-payment Of TDS
As per provisions of Section 271C penalty for non-deduction/non-payment of TDS would be an amount equal to tax not so deducted/paid.
7. TDS Return:-
Every Deductor is required to File Quarterly Statement. The statement shows a summary of all the entries for TDS collected by the deductor and the TDS paid by the deductor to the Income Tax Authority.
Types of TDS Returns with Due Dates
|
Type of TDS Return |
Applicability |
Due Date of Filing the same |
|
|
Form No. 24Q |
TDS on Salary |
Qtr I Qtr II Qtr III Qtr IV |
31st July 31st October 31st January 31st May |
|
Form No. 26Q |
TDS Other than Salary (e.g. Interest, Rent, Commission/Brokerage) |
Qtr I Qtr II Qtr III Qtr IV |
31st July 31st October 31st January 31st May |
|
Form No. 27Q |
|
||
Projects completed for our respected clients.
Experienced people serving to clients.
Years experience in business & consulting.
Expert peoples
At vero eos et accusamus etiusto odio praesentium.
Big experience
At vero eos et accusamus etiusto odio praesentium.
Committed to quality
At vero eos et accusamus etiusto odio praesentium.