TDS Rates

TDS Rates | TDS Rate Chart and Salary Rate

TDS Rates: Tax Deducted at Source, is known as TDS. It is a tax where one is responsible for the deduction of tax for certain rendered services. The tax gets deducted from the total payment amount that goes to the government for various activities like infrastructure development, defence, etc. Depending on the type of service, a specific tax (TDS) is imposed that the payee is expected to deduct.

TDS Rate on Salary

An employer can deduct tax at the source while paying to the employee and deduct tax from salaries at the time of payment. TDS will get deducted if an individual’s total income is taxable. However, and not get deducted if the total income is 2,50,000. This amount will be applicable to men and women who are below 60 years.

TDS deduction rate on salary starts from 5% to 30%, which is equal to the applicable income tax slabs.

TDS Rate Chart

Section number For the payment of Individual Others
192 Salary Tax Rate N/A
192A The payment of the balance due to an employee under the Employees Provident Fund Scheme, 1952 10% 10%
193 Interest on Debentures 10% 10%
194 Deemed Dividend 10% 10%
194A Interest other than on securities 10% 10%
194B Winnings from lotteries/ games 30% 30%
194BB Winnings from horse race 30 30
194C Payment to contractor 1 2
194D Payment of Insurance Commission 5 5
194DA Payment under Life Insurance Policy 1 N/A
194E Payment to non-resident sportsmen or sports association 20 20
194EE Payment of NSS deposits 10 N/A
194F Repurchase of units by Mutual funds or UTI 20 20
194G Commission on sale of lottery tickets 5 5
194H Commission or brokerage 5 5
194I Rent of land, building and furniture 10 10
194I Rent of plant and machinery 2 2
194IA Purchase of immovable property 1 1
194IB Rent payable by an individual 5 5
194IC The payment of monetary consideration under Joint development agreement 10 10
194J Professional services 10 10
194LA Compensation on acquisition of immovable property 10 10
194LB The payment of interest on infrastructure debt fund to non-resident N/A 5
194LBA Income from specific units of a business trust. 10 5
194LBB Investment fund that pays an income to a unitholder (other than income which is exempt under section 10(23FBB) 10 10
194LBC Investment income in securitization trust. 25 30
194LC Payment of interest by an Indian company in respect of money borrowed in foreign currency under a loan agreement N/A 5
194LD Payment of interest on a rupee-denominated bond of an Indian company or Government securities to a foreign institutional investor N/A 5
195 Others sums Average rates Average rates
196A Income in respect of units of non-residents N/A 10 for company, and 20 for person
196B Income from units (including long term capital gains on transfer of such units) to an offshore fund N/A 10
196C Income which comes from foreign currency bonds or GDR (including long term capital gains on transfer of such bonds) N/A 10
196D  Income of FIIs from securities N/A 20

Notes: No surcharge or education cess is levied on payments made to residents (Individuals / HUF / Society / AOP / Firm / Domestic Company). However, education cess is charged in case of salary.

TDS at a higher rate of 20% or TDS rate, whichever is higher, must be deducted if the deductee fails to provide PAN to the deductor.

If any taxpayer does not comply with the TDS rules, they will be liable to pay penalties in the form of and interest will be imposed on the principle taxable amount.

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