Sections | Nature of Payment | When to Deduct | Payment in excess of | Rates |
192 | TDS on Salary | Monthly- at the time of payment where estimated yearly net taxable salary exceeds tax free limit. | Rs. 2,50,000 p.a. (Refer Note No. -1) | At the average rate of income- tax computed on the basis of the rates in force for the financial year. #**** |
192A | Payment of accumulated balance due of Employees' Provident Fund Scheme, 1952, to Employees which is taxable in their hand | When the amount of payment or aggregate amount of payment exceeds threshold limit | Rs. 50,000 | 10% * |
193 | Interest on Securities | At the time of credit or payment, whichever is earlier | Rs. 10,000 (In case of debentures Rs. 5,000) | 10% ** |
194 | Dividend (including dividend as referred to in section 115-O) (Amended vide Finance Act, 2020 - Refer Note No. 6) | Before making payment to Resident shareholder | Rs. 5,000/- (w.e.f. 01.04.2020 the monetary limit has increased from Rs. 2,500/- to Rs. 5,000/- vide Finance Act, 2020) | 10% ** |
194A | Interest from a Post Offices, Banks including Co- Operative Banks (Received by individual/ HUF other than Senior Citizen) | At the time of credit or payment, whichever is earlier | Rs. 40,000 p.a. | 10% ** |
Interest from a Post Offices, Banks including Co- Operative Banks (Received by a Senior Citizen) | At the time of credit or payment, whichever is earlier | Rs. 50,000 p.a. | 10% ** | |
Interest other than interest on securities - Others (Amended vide Finance Act, 2020 - Refer Note No. 6) | At the time of credit or payment, whichever is earlier | Rs. 5,000 p.a. | 10% ** | |
194B / 194BB | Income by way of winnings from lotteries, crossword puzzles, card games and other games of any sort/ Income by way of winnings from horse races | At the time of payment | Rs.10,000 p.a. | 30%* |
194C | Contractors Including Advertising, Sub - contractor & Transporter who owns more than 10 goods carriage (Amended vide Finance Act, 2020 - Refer Note No. 6) | At the time of credit or payment, whichever is earlier | Rs. 30,000 (per bill) or Rs.1,00,000 (aggregate for year) | 1% in case of Individual/HUF and 2% in case of others** |
In case of transporters who owns less than or equal to 10 goods carriages | No TDS Deductible if declaration is furnished by transporter that he owns less than or equal to 10 goods carriage along with PAN. However, TDS is deductible on Payment to Transporters owing more than 10 goods carriage. | |||
194D | Insurance Commission | At the time of credit or payment, whichever is earlier | Rs. 15,000 p.a. | 5% ** |
194DA | Payment under life insurance policy (including bonus) | At the time of payment | Rs. 1,00,000 p.a. | 5% ** (payments from 01.09.2019 & onwards) |
194E | Payment to Non-Resident Sportsmen or Sports Association | At the time of credit or payment, whichever is earlier | Any income referred to in section 115BBA | 20% ** |
194EE | Payment in respect of deposit under National Savings scheme (NSS) | At the time of payment | Rs. 2,500 | 10% ** |
194F | Payment on account of repurchase of unit by Mutual Fund or Unit Trust of India | At the time of payment | At the time of payment | 20% ** |
194G | Commission on sale of lottery tickets | At the time of credit or payment, whichever is earlier | Rs. 15,000 p.a. | 5% ** |
194H | Commission or brokerage (Amended vide Finance Act, 2020 - Refer Note No. 6) | At the time of credit or payment, whichever is earlier | Rs. 15,000 p.a. | 5% ** |
194-I | Rent of Land & Building or furniture or fittings (Amended vide Finance Act, 2020 - Refer Note No. 6) | At the time of credit or payment, whichever is earlier | Rs. 2,40,000 p.a. | 10% ** |
Rent of Plant & Machinery and other Equipment (Amended vide Finance Act, 2020 - Refer Note No. 6) | At the time of credit or payment, whichever is earlier | 2% ** | ||
The income by way of rent is credited or paid to a business trust, being a real estate investment trust (REIT), in respect of any real estate asset held directly by such REIT (Amended vide Finance Act, 2020 - Refer Note No. 6) | No TDS Deductible | |||
194-IA | Payment on transfer of certain Immovable Property other than Agriculture Land | At the time of credit or payment, whichever is earlier | Rs. 50,00,000 | 1% ** |
194-IB | Rent payable by an individual or HUF not covered u/s. 194-I | Tax shall be deducted on such income at the time of credit of rent, for the last month of the previous year or the last month of tenancy if the property is vacated during the year, as the case may be, to the account of the payee or at the time of payment thereof in cash or by issue of a cheque or draft or by any other mode, whichever is earlier | Rs. 50,000 p.m. or part of month | 5%*** |
194-IC | Payment of Consideration (not being in kind) under Joint Development Agreement or other similar agreement | At the time of credit or payment, whichever is earlier | Any sum by way of consideration | 10%** |
194J | Payment of fees for technical services (not being a professional services or royalty where such royalty is in the nature of consideration for sale, distribution or exhibition of cinematographic films) (Inserted vide Finance Act, 2020) (Amended vide Finance Act, 2020 - Refer Note No. 6) | At the time of credit or payment, whichever is earlier | Rs. 30,000 p.a. | 2% ** |
Payments received or credited to a payee, being a person engaged only in the business of operation of call center | At the time of credit or payment, whichever is earlier | Rs. 30,000 p.a. | 2% ** | |
Payment of professional services, royalty for not sharing any patent/knowhow/copyright, etc. (Other than those covered above) (Amended vide Finance Act, 2020 - Refer Note No. 6) | At the time of credit or payment, whichever is earlier | Rs. 30,000 p.a. | 10%** |
194J (1)(ba) | Any payment to Directors if the same is not covered u/s 192 | At the time of credit or payment, whichever is earlier | Any sum paid or payable to the Directors | 10% ** |
194K | Payment of income (i.e. Dividend) to any resident in respect of units of Mutual Fund specified under clause (23D) of section 10 or from Administrator of the specified undertaking or from specified company (Other than income which is in the nature of "Capital Gains") (Inserted w.e.f. 01.04.2020 vide Finance Act, 2020) | At the time of credit or payment, whichever is earlier | Rs. 5,000/- | 10%** |
194LA | Payment of compensation on acquisition of certain immovable property other than agricultural land | At the time of credit or payment, whichever is earlier | Rs. 2,50,000/- Note: No deduction shall be made under this section where such payment is made in respect of any award or agreement which has been exempted from levy of income-tax under section 96 of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013. | 10% ** |
194LB | Payment of interest by an Infrastructure debt fund to a non-resident or to a foreign company | At the time of credit or payment, whichever is earlier | Payment of interest | 5%** |
194LBA | Income distributed by Business Trust or Distribution of income by REIT in the form of interest received or receivable from a special purpose vehicle (Amended vide Finance Act, 2020) | At the time of credit or payment, whichever is earlier | Any distributed income referred to in section 115UA | 5%** |
Income distributed by Business Trust or Distribution of income by REIT in the form of dividend referred to in sub-section (7) of section 115-O (Amended vide Finance Act, 2020 - Refer Note No.7) | At the time of credit or payment, whichever is earlier | Any distributed income referred to in section 115UA | 10%** | |
194LBB | Investment fund paying an income to a unit holder [other than income which is exempt under Section 10(23FBB)] shall deduct tax therefrom | At the time of credit or payment, whichever is earlier | Any income payable | (a) 10%** (In case payee is a resident) (b) At the rates in force in case a payee is a non- resident or a foreign company |
194LBC | Income in respect of investment in securitisation trust | At the time of credit or payment, whichever is earlier | Any income payable | (a) 25% (In case payee is an Individual/HUF) (b) 30% (In case of others) |
194LC | Income by way of interest being in respect of monies borrowed by the Indian Company from a source outside India by way of issue of any long- term bond or rupee denominated bond on or after the 1st day of April, 2020 but before the 1st day of July, 2023, which is listed only on a recognised stock exchange located in any International Financial Services Centre, to a non-resident or to a foreign company (Amended vide Finance Act, 2020) | At the time of credit or payment, whichever is earlier | Any income payable by way of interest | 4% (Amended w.e.f 01.04.2020 vide Finance Act, 2020) |
Income by way of interest (other than covered above) from an Indian Company [being a specified company or the business trust] to a non-resident or to a foreign company (Amended vide Finance Act, 2020) | At the time of credit or payment, whichever is earlier | Any income payable by way of interest | 5% | |
194LD | Income by way of interest on certain bonds and Government securities to a Foreign Institutional Investor or a Qualified Foreign Investor (Amended vide Finance Act, 2020 - Refer Note No. 8) | At the time of credit or payment, whichever is earlier | Any income payable by way of interest on certain bonds and Government securities | 5% |
194M | Payment of certain sums by certain individuals or HUF to resident for carrying out any work in pursuance of a contractor or by way of commission or brokerage or by way of fees for professional services (other than those who are required to deduct TDS u/s 194C, 194H or u/s 194J) (Inserted vide Finance Act (No. 2), 2019 w.e.f. 01.09.2019) | At the time of credit or payment, whichever is earlier | Rs. 50,00,000/- | 5%** |
194N (Applicable up to 30.06.2020) | Payment by a banking company (to which Banking Regulation Act, 1949 applies), a co- operative society (engaged in banking business) or a post office to any person in cash (Inserted vide Finance Act (No. 2), 2019 w.e.f. 01.09.2019 - applicable for payments upto 30.06.2020) | At the time of payment | Payment in excess of Rs. 1,00,00,000/- | 2% |
194N (Applicable w.e.f. 01.07.2020) | Payment by a banking company (to which Banking Regulation Act, 1949 applies), a co- operative society (engaged in banking business) or a post office to any person in cash (Amended vide Finance Act, 2020 w.e.f. 01.07.2020) | |||
a. A person who has not filed the returns of income of all the three previous years, immediately preceding the previous year in which the payment of the sum is made to him and the time limit to file return u/s 139(1) has expired | At the time of withdrawal | Payment exceeding Rs. 20 lakhs but upto Rs. 1 crore | 2% | |
Payment exceeding Rs. 1 crore | 5% | |||
b. For persons other than mentioned above in (a) | At the time of withdrawal | Payment exceeding Rs. 1 crore | 2% | |
194-O (Applicable w.e.f. 01.10.2020) | Payment of certain sums by E-Commerce operator to E-Commerce participants for sale of goods or provision of service facilitated by it through its digital or electronic facility or platform | At the time of credit or payment, whichever is earlier | (a) Rs. 5 lakhs (in case of individual or HUF) | 1%** |
(b) Any sum (in cases other than mentioned above in(a)) |
* (30 % i.e. Maximum Marginal Rate, if no valid PAN) |
** (20 % if no valid PAN) (5% if no valid PAN and TDS is to be done u/s 194-O) - Section 206AA amended vide Finance Act, 2020 |
*** (20 % subject to maximum of last month rent payable - if no valid PAN) |
**** (As per slab rates in force - if no valid PAN @ 20%) |
# Surcharge, Health and Education cess will be added to the above tax rate, as applicable. |
Notes:
1. Please note that for deduction of tax, the threshold limit i.e. the maximum amount not chargeable to tax is Rs. 2,50,000/- in both, Old as well as New tax regime. However, no tax is deductible till the net income does not exceed Rs. 5 Lakh, as rebate u/s 87A of the Income Tax Act, 1961 is available up to maximum of Rs. 12,500/-; if it exceeds Rs. 5 Lakh then TDS is deductible at the applicable slab rates. For payments to residents, education cess is applicable only while deducting TDS on salary.
2. Surcharge is applicable if payment > Rs. 50 lakhs, as per the following table:
Particulars | Rs. 50 Lacs to Rs. 1 Crore | Rs. 1 Crore to Rs. 2 Crores | Rs. 2 Crores to Rs. 5 Crores | Exceeding Rs. 5 Crores |
Individual / HUF/ AOP/ BOI | 10% | 15% | 25% | 37% |
4. Transporters not owning more than 10 goods carriages have to submit PAN & give a declaration in order to avail NIL rate benefit.
5. The above rates mentioned are for resident payee. In case of any payment made to Non-Resident kindly contact us for clarification.
6. Where TDS is liable to be deducted u/s 194A,194C,194H,194-I,194J by any individual or HUF for payments made under the respective sections mentioned herein above, if his gross sales or turnover or receipts exceeding Rs. 1 crore from business or Rs. 50 lakhs from profession - Inserted w.e.f 01.04.2020 vide Finance Act, 2020.
7. TDS is not to be deducted for dividend income, if the special purpose vehicle referred to in the said clause has not exercise d the option under section 115BAA.
8. For section 194LD, the substituted sub-section 2 stands as under:
"(2) The income by way of interest referred to in sub-section (1) shall be the interest payable:
(a) on or after the 1st day of June, 2013 but before the 1st day of July, 2023 in respect of the investment made by the payee in—
(i) a rupee denominated bond of an Indian company; or
(ii) a Government security;
(b) on or after the 1st day of April, 2020 but before the 1st day of July, 2023 in respect of the investment made by the payee in municipal debt securities.
Provided that the rate of interest in respect of bond referred to in sub-clause (i) of clause (a) shall not exceed the rate as the Central Government may, by notification in the Official Gazette, specify."
B) Rate of Deduction of Tax collection at Source (TCS) for F.Y. 2020-21 (A.Y. 2021-22):
Sr. No. | Nature of payment | TCS Rate |
1 | Scrap | 1%* |
2 | Tendu Leaves | 5%* |
3 | Timber obtained under a forest lease or other mode | 2.5%* |
4 | Any other forest produce not being timber or tendu leaves | 2.5%* |
5 | Alcoholic Liquor for human consumption | 1%* |
6 | Parking Lot, toll plaza, mining and quarrying | 2%* |
7 | Minerals, being coal or lignite or iron ore | 1%* |
8 | Sale of motor vehicle of the value exceeding Rs. 10 lakhs | 1%* |
9 | Foreign remittance under Liberalised Remittance Scheme (LRS) exceeding Rs. 7 lakhs for the purpose of repayment of loan obtained from a Financial Institution (As defined u/s 80E) for the purpose of pursuing of education (Inserted vide Finance Act, 2020 w.e.f. 01.10.2020) | 0.5%* |
10 | Foreign remittance under Liberalised Remittance Scheme (LRS) exceeding Rs. 7 lakhs (other than those covered above at Sr. No. 9) (Inserted vide Finance Act, 2020 w.e.f. 01.10.2020) | 5%* |
11 | Sale of overseas tour programme package (Inserted vide Finance Act, 2020 w.e.f. 01.10.2020) | 5%* |
12 | Sale of any goods exceeding Rs. 50 lakhs (other than goods being exported out of India or any other sale mentioned above) (Inserted vide Finance Act, 2020 w.e.f. 01.10.2020) | 0.1%* |
*If invalid pan: TCS will be collected higher of following:
a) twice of the rate specified in relevant provision or
b) at the rate of 1% (amended vide Finance Act, 2020)
Definitions for the newly inserted sections vide Finance Act, 2020 are as follows:
A. In respect of Sr. No. 11 - Sale of overseas tour programme package:
“Overseas tour program package” means any tour package which offers visit to a country or countries or territory or territories outside India and includes expenses for travel or hotel stay or boarding or lodging or any other expenditure of similar nature or in relation thereto.
B. In respect of Sr. No. 12 - Sales of goods exceeding Rs. 50 lakhs:
i. 'Buyer' means a person who purchases any goods but does not include;
A. The Central Govt., a State Govt., an embassy, a High Commission, legation commission, consulate and the trade representation of a foreign state or
B. Local authority as defined in explanation to clause (20) of section 10 or
C. A person importing goods into India or any other person as the Central Government may, by notification in the Official Gazette, specify for this purpose, subject to such conditions as may be specified therein.
ii. 'Seller' means a person whose total sales, gross receipts or turnover from the business carried on by him exceed Rs. 10 crores during the financial year immediately preceding the financial year in which the sale of goods is carried out, not being a person as the Central Government may, by notification in the Official Gazette, specify for this purpose, subject to such conditions as may be specified therein.
C) Due dates for filing returns & issuing certificates:
Months | Due Dates | Forms | |||||
| Deduction of TDS/TCS | Deposit of payment | Quarterly Filing | Issue of Certificate | Payment | e-Return Filing | Issue of Certificate | |
Apr-20 | On Salary- At the Time of payment Others-When income paid or credited including credit to “Payable” or “Suspense” account. | 7 May 2020 | TDS - 31st July, 2020 TCS - 15th July, 2020 | TDS - 15th August, 2020 (not for salary) TCS - 30th July, 2020 | • Challan No. 281 | • Salary: Form 24Q | • Salary TDS: Form 16 |
May-20 | 7 June 2020 | ||||||
Jun-20 | 7 July 2020 | ||||||
Jul-20 | 7 August 2020 | TDS - 31st Oct, 2020 TCS - 15th Oct, 2020 | TDS - 15th November, 2020 (not for salary) TCS - 30th Oct, 2020 | • Others: Form 26Q | • Others TDS: Form 16A | ||
Aug-20 | 7 September 2020 | ||||||
Sep-20 | 7 October 2020 | ||||||
Oct-20 | 7 November 2020 | TDS - 31st Jan, 2021 TCS - 15th Jan, 2021 | TDS - 15th February, 2021 (not for salary) TCS - 30th Jan, 2021 | •E-Payment of TDS is compulsory for companies and those covered under tax Audit | • TCS: 27EQ | • TCS: Form 27D | |
Nov-20 | 7 December 2020 | ||||||
Dec-20 | 7 January 2021 | ||||||
Jan-21 | 7 February 2021 | TDS - 31st May, 2021 TCS - 15th May, 2021 | TDS - 15th June, 2021 (Annual certificate for Salary - 15th June, 2021) TCS - 30th May, 2021 | • NRI: Form 27Q | • Compulsory to generate Form- 16A, 16 (Part-A) & 27D from TRACES | ||
Feb-21 | 7 March 2021 | ||||||
Mar-21 | 30 April 2021 * | ||||||
7 April 2021 ** | |||||||
Note-A: TDS deducted on Immovable Property transactions u/s. 204-IA - due date for payment of tax is within 30 days from the end of the month in which deduction is made. Due date for issuing certificate in form -16B to the payee within fifteen days from the due date of furnishing the challan cum statement form -26QB.
Note-B: TDS deducted on Rent payable by an individual or HUF not covered u/s. 204I - (Other than parties covered u/s. 44AB tax audit) u/s. 204- IB - due date for payment of tax is within 30 days from the end of the month in which deduction is made. Due date for issuing certificate in form-16C to the payee within fifteen days from the due date of furnishing the challan cum statement form -26QC.
Note-C: TDS deducted on Payment of certain sums by certain individuals or HUF to resident for carrying out any work in pursuance of a contractor or by way of commission or brokerage or by way of fees for professional services (other than those who are required to deduct TDS u/s 194C, 194H or u/s 194J) u/s 194M - due date of payment of tax is 30 days from the end of the month in which deduction is made. Due date for issuing certificate in form-16D to the payee within fifteen days from the due date of furnishing the challan cum statement in Form 26QD. (Inserted vide Finance Act (No. 2), 2019)
* Due date for payment of TDS on salary as well as other than salary
** Due date for payment of TCS
| Interest/ Fees/ Penalty / Prosecution for failure to comply with TDS/TCS provisions | |
| Events | Consequences |
Failure to Deduct or Collect TDS & TCS - Interest | Interest @ 1% per month or part of month on the amount of tax from date on which tax was deductible to the actual date of deduction |
Failure to Deposit TDS & TCS - Interest | Interest @ 1.5% per month or part of month on the amount of tax from date of deduction till date of deposit |
Failure to pay or deduct/ collect TDS & TCS - Penalty | 100% of tax failed to pay or deduct/collect as may be imposed by Joint Commissioner |
Failure to file TDS Return - Fees | Fees @ Rs. 200 per day subject to maximum amount of TDS |
Failure to issue TDS Certificates - Penalty | Penalty @ Rs 100 per day subject to maximum amount of TDS |
Failure to file TDS/ TCS return or furnishing inaccurate particulars like PAN, Challan, etc. | If the delay is more than 365 days from the prescribed time limit, then over & above late fee, penalty is also payable @ Min. Rs. 10,000 & Max. Rs. 1,00,000 |
Fails to submit form 27C to the Commissioner of Income Tax | Penalty of Rs. 100 per day for the period during which the failure continues |
Failure to pay TDS / TCS | Prosecution provision will be attracted and person who fails to pay TDS / TCS may be punishable with rigorous imprisonment for 3 months which may extend upto 7 years with fine. |
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