8Basic Details of TDS & TDS Rates & Applicability of the TDS :
In the below article, you will get all the latest information for TDS, A guide to what is TDS, TDS rates, TDS Certificates. Scroll down or jump to the topic from above contents menu.
What is TDS?
TDS stands for Tax Deducted at Source means collecting income tax in India. It is governed under the Indian Income Tax Act of 1961. It is managed by the Central Board for Direct Taxes (CBDT) and is part of the Department of Revenue managed by Indian Revenue Service (IRS).
The payment of these provisions shall be made after deducting prescribed percentage. IRS has a great importance while conducting tax audits. In TDS, Assessee is required to file the quarterly return to CBDT.
TDS Rates for FY 2016-17
Applicable TDS rates for FY 2016-17/AY 2017-18 currently in India are updated.
| TDS RATE CHART FY 2016-17 AY 17-18 | ||||
| Nature of Payment Made To Residents | Cutoff (Rs.) | Company / Firm / Co-operative Society / Local Authority | Individual / HUF | If No / Invalid PAN |
| Section – Description | Rate (%) | |||
| 192 – Salaries(note-10) | – | NA | Avg rates | 20 |
| 192A-Premature withdrawal from EPF ( wef 01.06.2016) | 30000 | NA | 10 | 34.608 |
| 193 – Interest on securities | – | 10 | 10 | 20 |
| 194 – Dividends | 2500 | 10 | 10 | 20 |
| 194A – Interest other than interest on securities – Others | 5000 | 10 | 10 | 20 |
| 194A – B@nks( Time deposits) | 10000 | 10 | 10 | 20 |
| 194A – B@nks (Recurring deposit)(01.06.16) | 10000 | 10 | 10 | 20 |
| 194A – Deposit in Co-op B@nks(01.06.16) | 10000 | 10 | 10 | 20 |
| 194B – Winning from Lotteries | 10000 | 30 | 30 | 30 |
| 194BB – Winnings from Horse Race | 5000 | 30 | 30 | 30 |
| 194 C – Payment to Contractors | – | – | – | – |
| 194C- Payment to Contractor – Single Transaction | 30000 | 2 | 1 | 20 |
| 194C-Payment to Contractor – Aggregate During the F.Y. | 75000 | 2 | 1 | 20 |
| 194C- Contract – Transporter who has provided valid PAN (up to 31.05.2016) | – | – | – | 20 |
| 194C- Contract – Transporter not covered under 44AE (wef 01.06.2016) | 30000 / 75000 | 2 | 1 | 20 |
| 194C- Contract – Transporter covered under 44AE & submit declaration on prescribed form with PAN (wef01.06.2016) | – | – | – | 20 |
| 194D – Insurance Commission | 20000 | 10 | 10 | 20 |
| 194DA Payment in respect of life insurance policy(applicable from 01.1.2014) | 100000 | 2 | 2 | 20 |
| 194E – Payment to Non-Resident Sportsmen or Sports Association | – | 20 | 20 | 20 |
| 194EE – Payments out of deposits under NSS | 2500 | 20 | – | 20 |
| 194F – Repurchase Units by MFs | – | 20 | 20 | 20 |
| 194G – Commission – Lottery | 1000 | 10 | 10 | 20 |
| 194H – Commission / Brokerage | 5000 | 10 | 10 | 20 |
| 194I – Rent – Land and Building – furniture – fittings | 180000 | 10 | 10 | 20 |
| 194I – Rent – Plant / Machinery / equipment | 180000 | 2 | 2 | 20 |
| 194IA -Transfer of certain immovable property other than agriculture land(w.e.f 1-6-2013) | 5000000 | 1 | 1 | 20 |
| 194J – Professional Fees | 30000 | 10 | 10 | 20 |
| 194LA – Immovable Property | 200000 | 10 | 10 | 20 |
| 194LB – Income by way of interest from infrastructure debt fund (non-resident) | – | 5 | 5 | 20 |
| 194LB – Income by way of interest from infrastructure debt fund (non-resident) | – | 5 | 5 | 20 |
| Sec 194 LC – Income by way of interest by an Indian specified company to a non-resident / foreign company on foreign currency approved loan / long-term infrastructure bonds from outside India (applicable from July 1, 2012) | – | 5 | 5 | 20 |
| 194LD – Interest on certain bonds and govt. Securities(from 01-06-2013) | – | 5 | 5 | 20 |
| 196B – Income from units | – | 10 | 10 | 20 |
| 196C-Income from foreign currency bonds or GDR (including long-term capital gains on transfer of such bonds) (not being dividend) | – | 10 | 10 | 20 |
| 196D – Income of FIIs from securities | – | 20 | 20 | 20 |
Basic of TDS on immovable property
Section 194IA of Income Tax Act by Freakans.
- This provision is applicable in respect of transactions effected on or after June 1, 2013.
- It seeks deduction of tax at source on transfer of certain immovable property other than agricultural land
- Any person being a transferee who is liable to pay to a resident by way of consideration for transfer of any immovable property exceeding 50 Lakhs shall at the time of credit of such sum to the account of the transferor or at the time of payment in whatever manner, has to deduct tax at source at 1% only
This TDS is required to be deducted by buyer of the property, as against other TDS deduction where in, seller deducts income tax and deposit TDS with the government.
What is TDS Certificates?
In this, A deductor is required to issue a TDS certificate to the assessee within a particular time period.
He has to issue TDS Certificates within one month of the next financial year.
TDS on contractor
According to section 194C of Income Tax Act – Tax need to be deducted 1% (for individual, HUF) or 2% (for others) of payment. Such work must be in pursuance of a contract (including sub contract) between the contractor and payer. TDS is to be made at the time of credit to the account of contractor or at the time of payment in cash or by cheque or draft or by any other mode whichever is earlier