TDS Rates 2021-22, Deduction, How to pay TDS, TDS Payment

TDS Rate Chart 2021-22 (Assessment Year) TDS (Tax Deducted at Source). Introduction of TDS: The concept of TDS was introduced with an aim to collect tax from the very source of income. As per this concept, 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.

TDS

TDS is required to be deducted by responsible person at the appropriate rates, from payments of specific nature i.e. salary, rent, contract payments, consultancy fees, commission, etc.

Applicable to all assessees other than indv/HUF.

Generally, tax is required to be deducted at the time of the credit to account of the payee or at the time of payment, Whichever is earlier

However, In case of payment of salary and payment in respect of life insurance policy, tax is required to be deducted at the time of payment.

TDS Rate Chart for AY 2021-22

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

Briefs of Section and Rate for TDS

TDS Rate Chart for FY 2020-2021 for a Person (other than a Company) who is Resident in India

ParticularsTDS Rates from 1 April 2020 to 13 May 2020 (%)TDS Rates from 14 May 2020 to 31 March 2021 (%)
Section 192: Payment of salaryAs per the Income Tax SlabAs per the Income Tax Slab
Section 193: Interest on securities: a) any securities or debentures for money which is provided by or on behalf of any corporation which is set up by a Central, State, or Provincial Act, or issued by a local authority107.5
b) any debentures which are provided by a company wherein the debentures are listed on a stock exchange which are acknowledged and adhere to the norms of the Securities Contracts (Regulation) Act, 1956 (42 of 1956) and any other rules made thereunder107.5
c) any security of a state government or the Central Government [7.75% Saving (Taxable) Bonds, 2018 and 8% Savings (Taxable) Bonds, 2003]107.5
d) Interest on any other security107.5
Section 194A: Income earned through interest other than “Interest on securities”107,5
Section 194B: Income earned through winnings from lotteries, card games, crossword puzzles, and/or any other type of games3030
Section 194BB: Income earned through winnings from horse races3030
Section 194C: Payment to contractor and/or sub-contractor: a) HUF/Individuals10.75
Section 194C: Payment to contractor and/or sub-contractor: b) Others21.5
Section 194D: Insurance commission53.75
Section 194DA: Payments made towards a life insurance policy13.75
Section 194EE: Payment made towards any deposit under the National Savings Scheme (NSS)107.5
Section 194F: Payment made towards the repurchase of unit(s) by Mutual Fund or Unit Trust of India2015
Section 194G: Income arising from commissions and/or other proceedings earned through lottery tickets sales53.75
Section 194H: Brokerage or commission53.75
Section 194-I: Rent paid for: a) Plant and Machinery21.5
Section 194-I: Rent paid for: b) Building or land or furniture or fitting107.5
Section 194 – IA: Payments made towards the transfer of some specific immovable property (except for land used for agriculture)10.75
Section 194 – IB: Payments towards rent which does not qualify for tax audit and is made by an individual or a Hindu Undivided Family (HUF) [with effect from 1 June 2017]53.75
Section 194 – IC: Monetary considerations which are paid under the Joint Development Agreements107.5
Section 194J: Any sum that is paid through the following: a) Royalty, b) Fees paid against professional services, c) For not sharing any patent, know-how, copyright, and so on, d) Fees paid against technical services, e) Remuneration/commission/fee to a director, or f) For not performing any activity that is associated to any business [the rate of Tax Deducted at Source (TDS) will be taken as 2% in case the payee is engaged with business operations in a call centre, with effect from 1 June 2017]10 27.5 1.5
Section 194LA: Payment of compensation arising at the time of acquiring some particular immovable property [Deduction of tax will not be made in case of the payments on which income tax is not leviable under the Right to Fair Compensation Act, 2013, w.e.f. 1 April 2017]107.5
Section 194LBA(1): Business organisations will be liable to deduct tax at the time of distribution of any amount (arising out of interest received or is receivable from a SPV and/or any income which arises out of rent, lease, or letting out of a real estate which is owned by the organisation) to the unitholders of the organisation.107.5
Section 194LBB: An investment fund which pays an income to a unitholder [except for the incomes which are exempted under Section 10(23FBB)]107.5
Section 194LBC: Income which is generated in regard to investments made in a securitisation trust [as mentioned in the explanation of Section 115TCA]For individuals and/or Hindu Undivided Families (HUFs) – 25
For any other person – 30
18.75
22.5
Any other type of income1010

TDS Rate Chart for FY 2020-2021 for a company

TDS Rate Chart for FY 2020-2021 for a domestic company:

ParticularsTDS Rates from 1 April 2020 to 13 May 2020 (%)TDS Rates from 14 May 2020 to 31 March 2021 (%)
Section 193: Interest on securities: a) any securities or debentures for money which is provided by or on behalf of any corporation which is set up by a Central, State, or Provincial Act, or issued by a local authority107.5
b) any debentures which are provided by a company wherein the debentures are listed on a stock exchange which are acknowledged and adhere to the norms of the Securities Contracts (Regulation) Act, 1956 (42 of 1956) and any other rules made thereunder107.5
c) any security of a state government or the Central Government [7.75% Saving (Taxable) Bonds, 2018 and 8% Savings (Taxable) Bonds, 2003]107.5
d) Interest on any other security107.5
Section 194: Dividend107.5
Section 194A: Income earned through interest other than “Interest on securities”107.5
Section 194B: Income earned through winnings from lotteries, card games, crossword puzzles, and/or any other type of games3030
Section 194BB: Income earned through winnings from horse races3030
Section 194C: Payment to contractor and/or sub-contractor: a) HUF/Individuals10.75
Section 194C: Payment to contractor and/or sub-contractor: b) Others21.5
Section 194D: Insurance commission1010
Section 194DA: Payments made towards a life insurance policy53.75
Section 194EE: Payment made towards any deposit under National Savings Scheme (NSS)107.5
Section 194F: Payment made towards the repurchase of unit(s) by Mutual Fund or Unit Trust of India2015
Section 194G: Income from commission and other proceedings earned on the sale of lottery tickets53.75
Section 194H: Brokerage or commission53.75
Section 194 – I: Rent paid for: a) Plant & Machinery21.5
Section 194 – I:Rent paid for: b) Building or land or fitting or furniture107.5
Section 194 – IA: Payment made towards the transfer of some specific immovable property except for land which is used for agriculture10.75
Section 194 – IC: Payment made in the form of a monetary consideration under the Joint Development Agreements107.5
Section 194J: Any sum that is paid through the following: a) Royalty, b) Fees paid against professional services, c) For not sharing any patent, know-how, copyright, and so on, d) Fees paid against technical services, e) Remuneration/commission/fee to a director, or f) For not performing any activity that is associated to any business [the rate of Tax Deducted at Source (TDS) will be taken as 2% in case the payee is engaged with business operations in a call centre, with effect from 1 June 2017]107.5
Section 194LA: Payment of compensation arising at the time of acquiring some particular immovable property [Deduction of tax will not be made in case of payments on which income tax is not leviable under the Right to Fair Compensation Act, 2013, w.e.f. 1 April 2017]107.5
Section 194LBA(1): Business organisations will be liable to deduct tax at the time of distribution of any amount (arising out of interest received or is receivable from a SPV and/or any income which arises out of rent, lease, or letting out of a real estate which is owned by the organisation) to the unitholders of the organisation.107.5
Any Other Income107.5

TDS Rate Chart

TDS Rates Chart for AU 2022-23 (FY 2021-22)

Effective from 1st April 2021

Nature of payment
Section of the Income-tax Act
TDS rate effective from April 1, 2021
Receiving accumulated taxable part of PF
Section 192A
10%
Interest received on securities
Section 193
10%
Dividend received from Mutual funds and on the company’s shares
Section 194 and 194K
10%
Interest other than Interest on Securities e.g. Fixed deposit interest
Section 194A
10%
Winnings from a lottery, crosswords or any sort of game
Section 194B
30%
Winnings from horse races
Section 194BB
30%
Insurance Commission received by an Individual
Section 194D
5%
Life Insurance Policies not exempt under Section 10(10D)
Section 194DA
5%
Commission or brokerage received except for Insurance Commission
Section 194H
5%
Payment made while purchasing land or property
Section 194IA
1%
Payment of rent by individual or HUF exceeding Rs. 50,000 per month
Section 194IB
5%
Payment made to professional or commission or brokerage of more than Rs 50 lakh and above
194M
5%
Cash withdrawal exceeding Rs 20 lakh or Rs 1 crore as the case maybe
194N
2%
Payment of Professional Fees etc.
194J
2%(FTS, certain royalties, call centre) 10%(others)
Payment in respect of deposits under National Savings Scheme
194EE
10%
Rent for plant and machinery
194- I(a)
2%
Rent for immovable property
194-I(b)
10%

TCS rates effective from April 1, 2021:

Nature of receipts
Section of the Income-tax Act
TCS rates effective from April 1, 2021
Sale of Tendu Leaves
206C(1)
5.00%
Sale of Timber obtained under a forest lease
206C(1)
2.50%
Sale of timber obtained by any other mode
206C(1)
2.50%
Sale of Any other forest produce not being timber/tendu leaves
206C(1)
2.50%
Sale of scrap
206C(1)
1.00%
Sale of Minerals, being coal or lignite or iron ore
206C(1)
1.00%
Grant of the license, lease, etc. of Parking lot
206C(1)
2.00%
Grant of license, lease, etc. of Toll Plaza
206C(1)
2.00%
Grant of license, lease, etc. of Mining and quarrying
206C(1)
2.00%
Sale of motor vehicle above 10 lakhs
206C(1F)
1.00%
Sale of any other goods
206C(1H)
0.1%

Other Requirements of TDS/TCS

  •  If recipient not furnish his/its PAN Tax shall be deducted at the normal rate or at the rate of 20% , whichever is higher

How to pay Tax Deducted 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

CERTIFICATE FOR DEDUCTION AT LOWER RATE OR NO DEDUCTION AT SOURCE

  • On application made to Assessing officer, if he satisfied that the total income of recipient justifies the deduction of income tax at any lower rates or no deduction of income tax, the AO shall give him such certificate under section 197.
  • The person responsible for paying the income shall deduct income tax at the rates specified in such certificate or deduct no tax as the case may be, mentioned in certificate issued under section 197.
  • The person responsible for TDS, shall submit one copy before the Chief commissioner or commissioner of TDS.

NO DEDUCTION of TDS

  • Section 197A
  • Amount of any income does not exceed the maximum amount which is not chargeable to tax
  • An individual, resident in India has furnished Form 15G in duplicate to the deductor
  • An individual, resident in India ( Senior Citizen) has furnished form 15H in duplicate to the deductor
  • By Offshore Banking Unit from the interest paid to nonresident or a person not ordinarily resident in India
  • From any payment to any person for or on behalf of the New pension system[10(44)]
  • From such specified payment to such institution, association or body or class of institutions as may be notified by the Central Government whose income is unconditionally exempt under section 10 and who are not statutorily required to file return under section 139.
  • Local Authority, SAARC fund, IRDA, Prime minister’s National relief fund, Recognised provident fund, ESIC fund etc.

Threshold Limit for no deduction of TDS

  • 192 (Salary) Estimated salary does not exceeds exemption limit, i.e. Rs.250000/- , 300000/- ,500000/-. ( It is applicable even employee does not have PAN)
  • 192 A(Withdrawal from employees provident fund scheme) Withdrawal is less than Rs. 50000/-
  • 193 (Interest on securities) Does not exceed Rs. 5000/-
  • Bank, Post office, Co operative society engaged in banking business – Sr. citizen-on FD- Rs. 50000/-, To other person- Rs. 40000/-
  • 194 For an Individual aggregate of amount of Dividends does not exceed Rs. 5000/-
  • 194A(Interest other than interest on securities) Any other person- Rs. 5000/-
  • 194 B (Winning from lottery or crossword puzzles) Does not exceed Rs. 10000/-
  • 194BB(Winning from horse race) Exceeds Rs. 10000/-
  • 194 C (payment to contractors) Single payment does not exceeds Rs. 30000 and the aggregate of such payment during the financial year does not exceed Rs. 100000/
  • 194 C (payment to contractors) Payment to transport operators has furnished PAN to deductors and having 10 or less than 10 goods carriages at any time during the financial year. Payment by an individual or HUF to a resident contractors for personal purposes.
  • 194 D (Insurance Commission) Does not exceed Rs. 15000/- 
  • 194 DA (Life Insurance Policy) Does not exceed Rs. 100000/- 
  • 194 G (On sale of lottery tickets) Does not exceed Rs. 15000/-
  • 194 H (Commission or brokerage) Does not exceed Rs. 15000/- 
  • 194 I (Rent income) Does not exceed Rs. 240000/-
  • 194 IA (Transfer of certain immovable property other than agriculture land) Consideration for immovable property is less than Rs. 50 lakhs
  • 194 IB (by certain Individual or HUF whose books of account are not required to be audited u/s 44AB(a)/(b) in the immediate preceding F.Y.) Rent of land or building does not exceed Rs. 50000/ per month.
  • 194 J ( Professional or technical service) Does not exceed Rs. 30000/-
  • 194 K (Income from units of Mutual fund) Does not exceed Rs. 5000/-
  • 194 O (Payment by e-commerce operator to e- commerce participant). If payment made to Individual or HUF e-commerce participant during the previous year does not exceed Rs. 5 lakhs.

Time of Deposit TDS

By an office of the Govt. and tax is paid without production of income tax challan.TDS: On the same day on which tax is deducted
By an office of Govt. and tax is paid accompanied by Income tax challan (ITNS281)On or before 7 days from the end of month in which tax is deducted
Tax is deducted/ collected by a person other than office of GovernmentIncome is paid or credited before March: within 7 days from the end of month in which tax is deducted.

  • Income paid or credited in the month of March: Tax should be deposited by April 30.
is deducted by a person other than office of Govt. and The AO has permitted quarterly deposit of tax deducted u/s 192, 194A, 194D and 194H
  • Tax Quarter ending:
  • June 30: By July 7
  • September 30: By October 7
  • December 31: By January 7
  • March 31: By April 30.
  • Tax is deducted by a person u/s 194-IA (Challan – 26QB)
  • Tax is deducted u/s 194-IB ( Challan26QC)
Within 30 days from the last date of month in which tax is deducted

TDS Payment

  • TDS should be deposit in Challan No. 281
  • TDS will have to deposit through internet banking.
  • Indicate accurate PAN in challan
  • Minor Head of Challan – 200 : TDS payable by tax payer
  • Minor Head of Challan – 400: TDS Regular assessment raised by Income Tax Department.
  • Amount of TDS, Interest, Late filing fee, penalty etc, should be separately shown while filing the challan
  • Note down BSR code, Challan serial number, Date of payment, and amount of challan. This will help you in case challan is misplaced.

Time limit for issuing TDS certificate in case of other than salary

For the Quarter ending Form No 16A
June 30August 15
September 30November 15
December 31February 15
March 31June 15

Consequences for Failure

Late filing fees for TDS Return U/s 234E: Mandatory late filing fees U/s 234E of Rs 200/- per day subject to maximum of TDS amount.

Penalty for Late filing or non filing of TDS Return U/s 271H: Failure to filing TDS return within 1 year from specified date will attract minimum penalty of Rs. 10000 and maximum penalty of Rs. 100000/-

Applicability of Interest on Non/ Late deduction TDS and Late payment of TDS :

  • i) Late Deduction: Interest @ 1% p.m. for late deduction of TDS on applicable amount.
  • ii) Late remittance: Interest @ 1.5% p.m. for late remittence on applicable amount

Penalty U/s 271C upto the amount of TDS if not deducted and paid to the Government account

Recommended

Join the Discussion