Everything You Need to Know About the TDS Rate Chart for FY 2024
Welcome to our comprehensive guide that sheds light on the TDS rate chart for the financial year 2024. As we enter the fiscal year 2024, understanding the intricacies of Tax Deducted at Source (TDS) becomes paramount.
Unravelling the complexities of TDS, this blog aims to empower you with the knowledge to navigate fiscal responsibilities confidently.
TDS Rate Chart for FY 2023-24
Here is the updated TDS rate chart for FY 2023-24:
| Section | Nature of Payment | Threshold (In Rs) | Individual / HUF TDS Rates (%) | Other TDS Rates (%) |
|---|---|---|---|---|
| 192 | Salaries | Rs. 2,50,000 | 10% | 10% |
| 192A | Premature EPF withdrawal* | Rs. 50,000 | 10% | 10% |
| 193 | TDS on interest on securities*** | Rs. 10,000 | 10% | 10% |
| 194 | Payment of dividend | Rs. 5,000 | 10% | 10% |
| 194A | Interest issued by banks or post offices on deposits | Rs. 40,000 Rs. 50,000 (For senior citizens) | 10% | 10% |
| 194A | Interest by others apart from on securities | Rs. 5,000 | 10% | 10% |
| 194B | Amounts that someone has won through lotteries, puzzles, or games | Aggregate of Rs. 10,000** | 30% | 30% |
| 194BB | Amounts that someone has won from horse races | Rs. 10,000 | 30% | 30% |
| 194C | Payments to contractor or subcontractor – Single Payments | Rs. 30,000 | 1% | 2% |
| 194C | Payments to contractor/sub-contractor – Aggregate Payments | Rs. 1,00,000 | 1% | 2% |
| 194D | Payment of insurance commission to domestic companies | Rs. 15,000 | NA | 10% |
| 194D | Payment of insurance commission to companies other than domestic ones | Rs. 15,000 | 5% | NA |
| 194DA | Maturity of Life Insurance Policy | Rs. 1,00,000 | 5% | 5% |
| 194EE | Payment of an amount standing to the credit of an individual under NSS (National Savings Scheme) | Rs. 2500 | 10% | 10% |
| 194F | Payment of repurchase of the unit by UTI (Unit Trust of India) or any mutual fund | No Limit | 20% | 20% |
| 194G | Payments or commissions on the sale of lottery tickets | Rs. 15,000 | 5% | 5% |
| 194H | Commission or brokerage | Rs. 15,000 | 5% | 5% |
| 194l | Rent of land, building, or furniture | Rs. 2,40,000 | 10% | 10% |
| 194l | Rent of plant and machinery | Rs. 2,40,000 | 2% | 2% |
| 194lA | Payment for transfer of immovable property other than agricultural land | Rs. 50,00,000 | 1% | 1% |
| 194IB | Rent payment that is made by an individual or HUF not covered under payment 194I | Rs. 50,000 (per month) | 5% | NA |
| 194IC | Payments that are made under the Joint Development Agreement (JDA) to Individual/HUF | No Limit | 10% | 10% |
| 194J | Fees paid for professional services | Rs. 30,000 | 10% | 10% |
| 194J | Amount paid for technical services | Rs. 30,000 | 2% | 2% |
| 194J | Amounts paid as royalty for sale/ distribution/ exhibition of cinematographic films | Rs. 30,000 | 2% | 2% |
| 194K | Payment of income for units of a mutual fund, for example- dividends | Rs. 5,000 | 10% | 10% |
| 194LA | Payment made for compensation for acquiring certain immovable property | Rs. 2,50,000 | 10% | 10% |
| 194LB | Payment of interest on infrastructure bonds to Non-Resident Indians | NA | 5% | 5% |
| 194LBA(1) | Certain income distributed by a business trust among its unit holder | NA | 10% | 10% |
| 194LD | Payment of interest on rupee-denominated bonds, municipal debt security, and government securitie | NA | 10% | 10% |
| 194M | Amounts paid for contract, brokerage, commission or professional fee (other than 194C, 194H, 194J) | Rs. 50,00,000 | 5% | 5% |
| 194N | In case cash withdrawal over a certain amount takes place from the bank, and ITR is filed | Rs. 1,00,00,000 | 2% | 2% |
| 194N | In case cash withdrawal takes place from a bank and one does not file ITR | Rs. 20,00,000 | 2% | 2% |
| 194O | Amount paid for the sale of products/services by e-commerce service providers via their digital platform | Rs. 5,00,000 | 1% | 1% |
| 194Q | Payments made for the purchase of goods | Rs. 50,00,000 | 0.10% | 0.10% |
| 194S | TDS on the payment of any crypto or other virtual asset | NA | 1% | 1% |
| 206AA | TDS for non-availability of PAN | NA | At a rate higher of:1. Specified rate as per the act2. 20%3. Rate in force | 20% |
| 206AB | TDS on non-filers of Income tax return | NA | Rate higher of:1. 5%2. Twice the mentioned rate in provision3. Rate in force |
TDS Rate Charts Where the Company is a Domestic Company
Here is a detailed table for TDS rate charts for a domestic company registered in India:
| Particulars | TDS Rate |
|---|---|
| Section 192: Payment of salarySection 192A: Premature withdrawal from EPF | Normal Slab Rate 10% |
| Section 193: Interest on securitiesa) any security of the Central or State Government;b) any debentures or securities for money issued by any local authority or a corporation established by a Central, State or Provincial Act;c) any debentures (listed on a recognised stock exchange) issued by a company where such debentures are ;d) interest on any other security | a) 10%b) 10%c) 10%d) 10% |
| Section 194: Payment of any dividend | 10% |
| Section 194A: Income in the form of interest (other than interest on securities). | 10% |
| Section 194B: Income by way of lottery winnings, card games, crossword puzzles, and other games of any type | 30% |
| Section 194BB: Income by way of horse race winnings | 30% |
| Section 194C: Payment to contractor/sub-contractor.a) Individuals/HUFb) Others | a) 1%b) 2% |
| Section 194D: Insurance commission | 10% |
| Section 194DA: Payment of any sum for a life insurance policy. w.e.f. 1st September 2019, the insurer shall deduct tax (TDS) on the income portion comprised in the insurance payout. | 5% |
| Section 194EE: Payment of amount standing to the credit of a person under the National Savings Scheme (NSS) | 10% |
| Section 194F: Payment due to repurchase of a unit by Unit Trust of India (UTI) or a Mutual Fund | 20% |
| Section 194G: Payments such as commission, etc., on the sale of lottery tickets | 5% |
| Section 194H: Commission or brokerage | 5% |
| Section 194-I: Rent ona) Plant and Machineryb) Land/building/furniture/fitting w.e.f 1st April 2019, tax deduction limit on rent is increased to Rs 2.4 lakhs p.a. from Rs 1.8 lakhs p.a. | a) 2%b) 10% |
| Section 194-IA: Payment in consideration of transfer of certain immovable property other than agricultural land. | 1% |
| Section 194-IC: Payment under Joint Development Agreements (JDA) to Individual/HUF | 10% |
| Section 194J: Any sum paid by way of:a) Fee for professional services;b) Remuneration/fee/commission to a director;c) For not carrying out any activity about any business;d) For not sharing any know-how, patent, copyright, etc.e) Fee for technical services, andf) Royalty towards the sale or distribution, or exhibition of cinematographic films.g) Fees for technical services but payee is engaged in the business of operation of call center | a) 10%b) 10%c) 10%d) 10%e) 2%f) 2%g) 2% |
| Section 194K: Payment of any income for units of a mutual fund as per section 10(23D) or from the administrator or specified company | 10% |
| Section 194LA: Payment in respect of compensation on acquisition of certain immovable property. | 10% |
| Section 194LBA(1): Certain income distributed by a business trust to its unitholder | 10% |
| Section 194LBB: Certain income paid for units of an investment fund to a unitholder. | 10% |
| Section 194LBC: Income from investment in securitisation fund | 10% |
| Section 194M: Certain payments by Individual/HUF (Limit- Rs 50 Lakhs) | 5% |
| Section 194N: Cash withdrawal exceeding a certain amount (limit- Rs 1 crore). In case Rs 20 lakh or more is withdrawn by the person who has not filed an ITR for the last three years, for which the due date of filing the ITR has expired, the TDS rates shall be applicable as per the below slab:a) amount more than Rs.20 lakh but up to Rs. 1 croreb) amount exceeding Rs. 1 crore | a) 2%b) 5% |
| Section 194O: For the sale of goods or provision of services by the e-commerce operator through its digital or electronic facility or platform. | 1% |
| Section 194Q: Payments to residents for the purchase of goods if the aggregate value of goods exceeds Rs 50 lakhs.(TDS is deductible on value exceeding Rs 50 lakhs) | 0.1% |
| Any Other Income | 10% |
TDS Rates Applicable for a company other than a Domestic Company
Here is a detailed table for the TDS rates applicable for a company other than a domestic company:
| Particulars | TDS Rates |
|---|---|
| Section 194B: Income by way of lottery winnings, card games, crossword puzzles, and other games of any type | 30% |
| Section 194BB: Income by way of horse race winnings | 30% |
| Section 194E: Payment to non-resident sportsmen (including an athlete) or an entertainer (not a citizen of India) or non-resident sports association. | 20% |
| Section 194G: Payments such as commission, etc., on the sale of lottery tickets | 5% |
| Section 194LB: Payment in respect of compensation on acquisition of certain immovable property. | 5% |
| Section 194LBA(2): Payments such as:a) 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.b) interest income received or receivable to a business trust from SPV and distribution to its unitholders. | a) 10%b) 5% |
| Section 194LBA(3)- payment like income in the nature of rental income, out of real estate assets owned directly by such business trust, to unitholders. | 40% |
| Section 194LBB: Payment of certain income by an investment fund to a unitholder. | 40% |
| Section 194LBC: Income from investment in securitization fund | 40% |
| Section 194LC: Payment like 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*.*If interest is payable against long-term bonds listed in recognized stock exchanges in IFSC | 5%4% |
| Section 194LD: Payment of interest on the bond (rupee-denominated) to Foreign Institutional Investors or a Qualified Foreign Investor. | 5% |
| Section 195: Payment of any other sum, such as income by way of LTCG under section 112(1)(c)(iii);a) Income by way of LTCG under section 112A;b) Income by way of STCG under section 111A;c) Any other income by way of LTCG;Interest payable on money borrowed by the government or Indian concern in foreign currency;Income from royalty payable to the Indian concern, by government or Indian concern, for the copyright in a subject referred to in the first provision of section 115A or computer software referred to in the second proviso of section 115A (an agreement made after 1st March 1976);Income from royalty payable to the Indian concern by the government or Indian concern in pursuance of an agreement on matters related to industrial policy.Where the agreement is made after- 31st March 1961 but before 1st April 1976-31st March 1976;Income from technical fees to the Indian concern by the government or Indian concern in pursuance of an agreement on matters related to industrial policy.Where agreement is made after- 29th February 1964 but before 1st April 197631st March 1976; Any other income. | 10%a) 10%b) 15%c) 20%20%10%50%10%50%10%40% |
| Section 196B: Income (including LTCG) from units of an offshore fund. | 10% |
| Section 196C: Income (including LTCG) from foreign currency bonds or GDR of an Indian company | 10% |
| Section 196D: Income (excluding dividend and capital gain) from Foreign Institutional Investors. | 20% |
Conclusion
TDS is a system where tax is deducted at the source of income, and compliance with the prescribed rates is essential to ensure smooth financial operations. It is important to adhere to the prescribed TDS rates, a legal requirement under the Income Tax Act of 1961, as failure to comply may result in penalties and legal consequences.
Hence, knowing the correct TDS rates is essential for businesses to carry out financial transactions smoothly. It helps in accurate budgeting and financial planning and prevents disruptions due to legal issues.
FAQs
Q1. What is the current TDS rate chart?
Ans: The current TDS rate chart depends on the nature of the expense under specific sections. You can find more details about the TDS rate chart by navigating to the section ‘TDS Rate Chart for FY 2023-24’ in the above blog.
Q2. What are the TDS rates for freelance services?
Ans: For freelance services, TDS is deducted under the ‘Professional and Technical Services’ in the ITR, which is 10% of the total payments received.
Q3. What are TDS and TCS?
Ans: Tax Deducted at Source (TDS) is a mechanism through which the government collects income tax at the source of income itself. On the other hand, Tax Collected at Source (TCS) is a similar concept to TDS, but it involves the collection of tax at the source of the sale of specified goods or services.
Q4. What is TDS under section 194N?
Ans: Under section 194N, cash withdrawal exceeds a certain amount (limit- Rs 1 crore). In case Rs 20 lakh or more is withdrawn by the person who has not filed an ITR for the last three years, for which the due date of filing the ITR has expired, the TDS rates shall be applicable as per the below slab:a) amount more than Rs.20 lakh but up to Rs. 1 crore: 2%b) amount exceeding Rs. 1 crore: 5%
Q5. How is TDS calculated?
Ans: TDS is calculated using the following formula: TDS Amount = Payment Amount x ( TDS Rate/100 )
Q6. What is TDS in salary?
Ans: Tax Deducted at Source (TDS) in salary refers to the process of deducting income tax from an employee's salary at the source itself, i.e., by the employer.
Q7. Does the TDS rate change every financial year?
Ans: It is not mandatory to change the TDS rates every year. However, every year, when the Finance Minister presents the budget, various changes are generally introduced in relation to TDS.
Q8. What is a TDS certificate?
Ans: A Tax Deducted at Source (TDS) certificate is an official document issued by the deductor (the person responsible for deducting TDS) to the deductee (the person from whose income TDS is deducted). The certificate details the TDS deducted and deposited with the government during a particular financial year.
