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Rate of TDS (Tax Deducted at Source)

In a simple language TDS stands for tax deducted at source. It is a tax that is deducted from the earning of the employee by the employer in other words it is a tax that is deducted at source. It is deducted as per the finance act of that year. TDS should not be confused with the income tax return; TDS is a different tax than income tax.

Tax deduction is useful to reduce the income tax and provide tax relief. TDS is deposited in the government treasury and later on assigned to central government. TDS came into existence because government wants to expand their tax bracket in the country.

Section Nature of Payment Paid/Credited to            
    Threshold Limit An Individual, HUF, BOI, AOP Payments Firm A Co-op. Soc., Local Authority Domestic Company Foreign Company Payments
    (in Rs.)         < 1 crore > 1 crore
192 Salary * Normal Rate + 3% cess N.A. N.A. N.A. N.A. N.A.
* after considering deduction u/Ch VIA–Male: Rs. 1,80,000;Female: Rs.1,90,000; Senior citizen: Rs. 2,50,000; uper Sr. Citizen Rs. 5,00,000/-
193 Interest on Securities to any resident (i) Interest on Debentures or securities (Listed)   2,500   10%   0%   0%   0%   N.A.   N.A.
  (ii) Interest on 8% Savings (Taxable) Bonds, 2003 10,000 10% 10% 10% 10% N.A. N.A.
  (iii) Any Other Interest on securities (Unlisted) Any Amount 10% 10% 10% 10% N.A. N.A.
194 Dividend other than dividend covered by Section 115-O to Resident 2,500 10% 10% 10% 10% N.A. N.A.
194A Interest other than interest on securities
Where the payer is- (i) Banking company (ii) Co-operative Society engaged in banking (iii) Post office under a deposit scheme
framed by Central Government (iv) Others
10,000   5,000 10%
10%
10%
10%
10%
10%
10%
10%
N.A.
10%
N.A.
10%
194B Winning from Lotteries 10,000 30% 30% 30% 30% 30.90% 31.518%
194BB Winnings from Horse Races 5,000 30% 30% 30% 30% 30.90% 31.518%
194C Payment to Resident Contractors All Contracts other than Transport Contract) 30,000** per payment/ credit 1% 2% 2% 2% N.A. N.A.
  Transport Contract $   Nil Nil Nil Nil Nil Nil
** The payments in a year in aggregate excess of Rs. 75,000 in a year also attract TDS at above rates.
$ The Nil rates are applicable only if the PAN details are obtained from the Transport Contractors.
194D Insurance Commission to Resident 20,000 10% 10% 10% 10% N.A. N.A.
194E Non-Resident sportsman/ sports association/s Resident Non-Resident Any Amount 10.00% 10.30% N.A. 10.30% N.A. 10.30% N.A. N.A. N.A. 10.30% N.A. 10.506%
194EE Deposits under NSS and if the payment is to Resident Non-Resident 2,500 20% 20.60% N.A. N.A. N.A. N.A. N.A. N.A. N.A. 20.60% N.A. 21.012%
194F Repurchase of units of MF/UTI Resident Non-Resident (Indl.) Any Amount   20% 20.60%   20% N.A.   20% N.A.   20% N.A.   N.A. 20.60%   N.A. 21.012%
94G Commission on sale of lottery tickets to Resident Non-Resident - (Indl.) 1,000   10% 10.30%   10% 10.30%   10% 10.30%   10% 10.30%   N.A. 10.30%   N.A. 10.506%
194H Commission or brokerage Brokerage to resident 5,000 10% 10% 10% 10% N.A. N.A.
194-I Rent to Resident for (a) machinery/plant/ equipments (b) For Land/Building 1,80,000   2% 10%   2% 10%   2% 10%   2% 10%   N.A. N.A.   N.A. N.A.
194J Fees for Professional/Technical services to Resident 30,000 10% 10% 10% 10% N.A. N.A.
194LA Compensation to Resident for compulsory acquisition of immovable property 100,000 10% 10% 10% 10% N.A. N.A.
194LB Payment for interest by Infrastructure Debt Fund (w.e.f. 01.06.2011) - N.A. N.A. N.A. N.A. 5.15% 5.253%
196B Income from units
(including long-term capital gain on transfer of such units) to an offshore fund Non-Resident
- N.A. N.A. N.A. N.A. 10.30% 10.506%
196C Income from foreign currency bonds or GDR of Indian company - N.A. N.A. N.A. N.A. 10.30% 10.506%
196D Income of FII from Securities not being dividend, long-term and short-term capital gain - N.A. N.A. N.A. N.A. 20.60% 21.012%