Based on the income bracket different TDS rates apply to different taxpayers. The TDS rates are predetermined as per the current year’s financial budget, and the tax is deducted from different taxpayers based on these charts.
Tax Deducted at Source (TDS) is deducted by the seller at the source for the product or services purchased by the customer. The tax that is collected from the TDS is submitted to the government which is used in multiple activities like infrastructure development, government development, defense utilities, etc. Depending on the type of product or service TDS is levied that the taxpayer has to deduct from the customer. If he deducts more than the required tax amount, the customer is liable to file for a TDS refund. The individual will be required to file a TDS return to receive the refund amount. TDS can be collected or regular, period or occasionally based on salary, commission, fee etc.
TDS Rates Applicable in India
Different TDS rates are applicable in different scenarios in India, the applicable rates for resident and non-resident payments as well as domestic and foreign companies in India are listed below in the tables.New TDS Rate Chart for the Residents of India
| Category | TDS Rate (in %) |
Section 192: Payment of salary Section 192A: Premature withdrawal from EPF | 10 |
Section 194B: Income through lottery winnings, crossword puzzles, card games, and other games | 30 |
Section 194BB: Income through a horse race | 30 |
Section 194E: Payment to the non-resident sportsman or an entertainer (not a citizen of India) or non-resident sports association. | 20 |
Section 194EE: Payment under National Savings Scheme (NSS) to a person | 10 |
Section 194F: Repurchase of a unit by Unit Trust of India (UTI) or a Mutual Fund | 20 |
Section 194G: Commission, tip, etc., on the sale of lottery tickets | 5 |
Section 194LB: Payment as compensation on acquisition of certain immovable property | 5 |
Section 194LBA(2) Interest income received by a business trust from SPV and distribution to its unitholders | 5 |
Section 194LBA(2) Dividend income received from SPV by a business trust, in which it holds the entire share capital other than required to be held by the government or government body, and distribution to its unitholders. | 10 |
Section 194LBA(3)- Rental income, out of real estate assets owned directly by such business trust, to unitholders | 30 |
Section 194LBB: Payment by an investment fund to a unitholder | 30 |
Section 194LBC: Income from investment in securitization fund | 30 |
Section 194LC: Interest for the loan borrowed in foreign currency by an Indian company or business trust against loan agreement or the issue of long-term bonds. | 5 |
If interest is payable against long term bonds listed in recognized stock exchange in IFSC | 4 |
Section 194LD: Interest on the bond in Rupees to Foreign Institutional Investors or a Foreign Investor. | 5 |
Section 196B: Income (including LTCG) from units of an offshore fund | 10 |
Section 196C: Income (including LTCG) from GDR of an Indian company or foreign currency bonds | 10 |
Section 196D: Income from Foreign Institutional Investors (excluding dividend and capital gain) | 20 |
New TDS Rate Chart For Domestic Company
| Category | TDS Rate (in%) |
Section 192: Payment of Salary Section 192A: Premature withdrawal from EPF | 10 |
Section 193: Interest on securities a) Central or State Government Securities b) Security by a local authority or a corporation established under a Central, State or Provincial Act c) Debentures issued by a company (listed on a recognized stock exchange) d) interest on any other security | 10 |
Section 194: Dividend Payment | 10 |
Section 194A: Income in the form of interest other than interest on securities | 10 |
Section 194B: Income from a lottery, card games, crossword puzzles, and any type of other games | 30 |
Section 194BB: Income through winning a horse race | 30 |
Section 194C: Payment to contractor or sub-contractor. a) Individuals/HUF b) Others | 1 2 |
Section 194D: Payment as an Insurance commission | 10 |
Section 194DA: Payment of any amount against a life insurance policy. w.e.f. 1st September 2019. The insurer shall deduct TDS on the income portion comprised in the insurance pay-out | 5 |
Section 194EE: Payment against National Savings Scheme (NSS) to a person | 10 |
Section 194F: Payment against repurchase by Unit Trust of India (UTI) or a Mutual Fund | 20 |
Section 194G: Commission, etc., on the sale of lottery tickets | 5 |
Section 194H: Payment as Commission or brokerage | 5 |
Section 194-I: Rent on a) Plant and Machinery b) Land/building/furniture/fitting w.e.f 1st April 2019, the new tax deduction limit on rent is Rs 2.4 lakhs p.a. | 2 10 |
Section 194-IA: Payment against the transfer of immovable property other than agricultural land. | 1 |
Section 194-IC: Payment for Joint Development Agreements (JDA) to Individual or HUF | 10 |
Section 194J: Any sum paid as a Fee for professional services | 10 |
Section 194J: Any sum paid as a Remuneration/ fee or commission to a director | 10 |
Section 194J: Any sum paid for not carrying out any activity in relation to any business | 10 |
Section 194J: Any sum paid for not sharing any know-how, patent, copyright etc. | 10 |
Section 194J: Any sum paid as a Fee for technical services | 2 |
Section 194J: Any sum paid as a Royalty towards the sale or distribution, or exhibition of cinematographic films | 2 |
Section 194J: Any sum paid as a Fees for technical services to the business of operation of call center | 2 |
Section 194K: Payment against units of a mutual fund as per section 10 (23D) or from the specified company or the administrator | 10 |
Section 194LA: Payment as compensation on acquisition of certain immovable property | 10 |
Section 194LBA(1): Payment distributed by a business trust to its unitholder | 10 |
Section 194LBB: Payment against units of an investment fund to a unitholder | 10 |
Section 194LBC: Payments for investment in securitization fund | 10 |
Section 194M: Certain payments by individuals or HUF up to Rs 50 Lakhs | 5 |
Section 194N: Cash withdrawal above Rs 1 crore In case Rs 20 lakh or more is withdrawn by the person not-filing ITR for the last three years, TDS rates shall be applicable as per below slabs- a. For Rs.20 lakh – Rs. 1 crore b. For above Rs. 1 crore | 2 2 5 |
Section 194O: For the sale of goods or provision of services by the e-commerce operator through its digital or electronic platform | 1 |
| Section 194P: Payments (pension or interest) to senior citizens or age 75 years or more | Tax on total income as per the rates |
Section 194Q: Payments to suppliers for the purchase of goods above Rs 50 lakhs | 0.1 |
Any other Income | 10 |
FY 2021-22 TDS Rate Chart For Non-Domestic Companies
| Category | TDS Rate (in%) |
Section 194B: Income from the lottery, card games, crossword puzzles, and any type of other games | 30 |
Section 194BB: Income through winning a horse race | 30 |
Section 194E: Payment to the non-resident sportsman or an entertainer (not a citizen of India) or non-resident sports association. | 20 |
Section 194G: Commission, tip, etc., on the sale of lottery tickets | 5 |
Section 194LB: Payment as compensation on acquisition of certain immovable property | 5 |
Section 194LBA(2) Interest income received by a business trust from SPV and distribution to its unitholders | 5 |
Section 194LBA(2) Dividend income received from SPV by a business trust, in which it holds the entire share capital other than required to be held by the government or government body, and distribution to its unitholders. | 10 |
Section 194LBA(3)- Rental income, out of real estate assets owned directly by such business trust, to unitholders | 40 |
Section 194LBB: Payment against an investment fund to a unitholder | 40 |
Section 194LBC: Income from investment in securitization fund | 40 |
Section 194LC: Interest for the loan borrowed in foreign currency by an Indian company or business trust against loan agreement or against the issue of long-term bonds. | 5 |
If interest is payable against long term bonds listed in recognized stock exchange in IFSC | 4 |
Section 194LD: Interest on the bond in Rupees to Foreign Institutional Investors or a Foreign Investor | 5 |
Section 196B: Payment for units of an offshore fund including LTCG | 10 |
Section 196C: Payment for foreign currency bonds or GDR (including LTCG) of an Indian company | 10 |
Section 196D: Payment for Foreign Institutional Investors (excluding dividend and capital gain) | 20 |
TDS Rate Chart FY 2020-21
