Rates of TDS for FY 2020-21

Income tax Rates Taxation

Normal TDS rate for financial year 2020-21 were changed w.e.f 14th may 2020 by reducing normal TDS rates by 25%. But this reduction of TDS rates was not applicable to all type of transactions and some transactions like salary, PF payments shall continue to attract normal rate of TDS. Further w.e.f 1-4-2020, some new transactions were also brought under the preview of TDS, like TDS on divident (U/s 194). A complete list of TDS rate along with related transactions for financial year 2020-21 (AY-2020-21) is provided in the table given below.–

TDS Rate Chart for FY 2020-21 (AY 2021-22)

Payment TypeThreshold Limit (Rs)Resident -TDS Rate (%) Upto 13th May, 2020Non-Resident -TDS Rate (%) Upto 13th May, 2020 (including EC & SHEC)Resident -TDS Rate (%) w.e.f 14th may 20Non-Resident -TDS Rate (%) w.e.f 14th may 20 (including EC & SHEC)
Section 192: Payment of salaryNormal Slab RateNormal Slab RateNormal Slab RateNormal Slab Rate
Section 192A: Payment of accumulated balance of provident fund which is taxable in the hands of an employee50, 0001010.40(Not applicable for Foreign Companies)1010.40(Not applicable for Foreign Companies)
Section 193: Interest on securities
a) any debentures or securities for money issued by or on behalf of any local authority or a corporation established by a Central, State or Provincial Act;107.5
b) any debentures issued by a company where such debentures are listed on a recognised stock exchange in accordance with the Securities Contracts (Regulation) Act, 1956 (42 of 1956) and any rules made thereunder;107.5
c) any security of the Central or State Government;[i.e. 8% Savings (Taxable) Bonds, 2003 and 7.75% Saving (Taxable) Bonds, 2018]10, 00010 7.5
d) interest on any other security107.5
Section 194: Dividend5, 000(w.e.f. 1/4/2020)107.5
Section 194A: – Interest other than interest on securities – Others5, 000107.5
Section 194A: Banks / Co-operative society engaged in business of banking / Post Office40, 000107.5
Section 194A: Senior citizenThe interest amount should be earned from the following:-Deposits with banks;-Deposits with post offices-Fixed deposit schemes-Recurring deposit schemes50, 000107.5
Section 194B: Income by way of winnings from lotteries, crossword puzzles, card games and other games of any sort10, 0003031.203031.20
Section 194BB: Income by way of winnings from horse races10, 0003031.203031.20
Section 194C: Payment to contractor / sub-contractorRs 30, 000 per contract or Rs 1, 00, 000 for aggregate amount during the year
a) HUF/ Individuals10.75
b) Others21.50
Section 194D: Insurance commission15, 00053.75
Section 194DA: Payment in respect of life insurance policy w.e.f. 1/9/2019, the tax shall be deducted on the amount of income comprised in insurance pay-out1, 00, 00053.75
Section 194E: Payment to non-resident sportsmen /sports association20.8020.80
Section 194EE: Payment in respect of deposit under National Savings scheme2, 5001010.40(Not applicable for Foreign Companies)7.510.40(Not applicable for Foreign Companies)
Section 194F: Payment on account of repurchase of unit by Mutual Fund or Unit Trust of India2020.80(Not applicable for Foreign Companies)1520.80(Not applicable for Foreign Companies)
Section 194G: Commission, etc., on sale of lottery tickets15, 00055.203.755.20
Section 194H: Commission or brokerage15, 00053.75
Section 194I: Rent2, 40, 000
a) Plant & Machinery21.5
b) Land or building or furniture or fitting107.5
Section 194-IA: Payment on transfer of certain immovable property other than agricultural land50, 00, 00010.75
Section 194-IB: Payment of rent by individual or HUF not liable to tax auditRent for the month or part of the month exceeds Rs 50, 00053.75
Section 194-IC: Payment of monetary consideration under Joint Development Agreements107.5
Section 194J: Payment for fees for Technical services, Professional services or royalty etc.Rs 30, 000 p.a
a) Cases, wherein, the payee is engaged in the business of the operation of Call Centre only (effective from 1st June 2017)21.5
b) In case of fees for technical services (not being a professional royalty where such royalty is in the nature of consideration for sale, distribution or exhibition of cinematographic film(effective from 1st April 2020)21.5
c) Professional royalty where such royalty is in the nature of consideration for sale, distribution or exhibition of cinematographic film107.5
d) In case of fees for any other professional services107.5
e) In case the payee fails to furnish PAN2020
Section 194K: Payment of any income in respect ofa) Units of a Mutual Fund as per Section 10(23D)b) Units from the administratorc) Units from specified company(This Section is inserted by Finance Act, 2020 which is applicable from 01/04/2020)107.5
Section 194LA: Payment of compensation on acquisition of certain immovable property2, 50, 000107.5
Section 194LB: Payment of interest on infrastructure debt fund5.205.20
Section 194LBA(1): Business trust shall deduct tax while distributing, any interest received or receivable by it from a SPV or any income received from renting or leasing or letting out any real estate asset owned directly by it, to its unit holders.107.5
Section 194LBA(2): Payment of the nature referred to in Section 10(23FC)(a)55
Section 194LBA(2): Payment of the nature referred to in Section 10(23FC)(b)1010
Section 194LBA(3): Business trust shall deduct tax while distributing any income received from renting or leasing or letting out any real estate asset owned directly by it to its unit holders.For Non Resident Individual – 31.20 For Foreign Company – 41.6For Non Resident Individual – 31.20 For Foreign Company – 41.6
Section 194LBB: Investment fund paying an income to a unit holder [other than income which is exempt under Section 10(23FBB)]10For Non Resident Individual – 31.20.For Foreign Company – 41.67.5For Non Resident Individual – 31.20.For Foreign Company – 41.6
Section 194LBC: Income in respect of investment made in a securitisation trust (specified in Explanation of section 115TCA)25% in case of Individual or HUF30% in case of other resident person10% in case of Domestic Companies For Non Resident Individual – 31.20 For Foreign Company – 41.618.75% in case of Individual or HUF22.50% in case of other resident person7.5% in case of Domestic Companies For Non Resident Individual – 31.20 For Foreign Company – 41.6
Section 194LC: Payment of interest by an Indian Company or a business trust in respect of money borrowed in foreign currency under a loan agreement or by way of issue of long-term bonds (including long-term infrastructure bond)Note: Now TDS at concessional rate of 5% will be applicable for borrowings made after April 1, 2020 but before July 1, 2023.5.20[In case where interest is payable in respect of Long-term Bond or Rupee Denominated Bond listed on recognised stock exchange located in IFSC then rate will be 4.16%]5.20[In case where interest is payable in respect of Long-term Bond or Rupee Denomi-nated Bond listed on recognised stock exchange located in IFSC then rate will be 4.16%]
Section 194LD: Payment of interest on rupee denominated bond of an Indian Company or Government securities to a Foreign Institutional Investor or a Qualified Foreign InvestorNote: Now TDS at concessional rate of 5% will be applicable for borrowings made after April 1, 2020 but before July 1, 2023.5.205.20
Section 194M: Payment of commission (not being insurance commission), brokerage, contractual fee, professional fee to a resident person by an Individual or a HUF who are not liable to deduct TDS under section 194C, 194H, or 194J.Tax shall be deducted under section 194M with effect from 1/09/2019.50 Lakhs53.75
Section 194N:a) Filed the returns of income for all of the three assessment years relevant to the three previous years and cash withdrawals exceeding 1 cr   –   2   –   2   –
b) Not Filed the returns of income for all of the three assessment years relevant to the three previous years: (This provision is applicable w.e.f. 01 July, 2020)– Cash withdrawals from 20 Lakhs to 1 Cr  2(w.e.f. 01 July, 2020)    –  2(w.e.f. 01 July, 2020)    –
– Cash withdrawals exceeding 1 cr55
Section 194O: Applicable for E-Commerce operator for sale of goods or provision of service facilitated by it through its digital or electronic facility or platform.(In case the E-commerce participant does not furnish PAN or Aadhar Number to the e-commerce operator, TDS shall be deducted at the rate of 5% under section 206AA of the Act)(This Section is inserted by Finance Act, 2020 which is applicable from 01/10/2020)1(w.e.f. 01st October, 2020)0.75(w.e.f. 01st October, 2020)
Section 195: Payment of any other sum to a Non-resident
a) Income in respect of investment made by a Non-resident Indian Citizen20.8020.80
b) Income by way of long-term capital gains referred to in Section 115E in case of a Non-resident Indian Citizen10.4010.40
c) Income by way of long-term capital gains referred to in sub-clause (iii) of clause (c) of sub-Section (1) of Section 11210.4010.40
d) Income by way of long-term capital gains as referred to in Section 112A10.4010.40
e) Income by way of short-term capital gains referred to in Section 111A15.6015.60
f) Any other income by way of long-term capital gains [not being long-term capital gains referred to in clauses 10(33), 10(36) and 112A20.8020.80
g) Income by way of interest payable by Government or an Indian concern on moneys borrowed or debt incurred by Government or the Indian concern in foreign currency (not being income by way of interest referred to in Section 194LB or Section 194LC)20.8020.80
h) Income by way of royalty payable by Government or an Indian concern in pursuance of an agreement made by it with the Government or the Indian concern where such royalty is in consideration for the transfer of all or any rights (including the granting of a licence) in respect of copyright in any book on a subject referred to in the first proviso to sub-section (1A) of Section 115A of the Income-tax Act, to the Indian concern, or in respect of any computer software referred to in the second proviso to sub-section (1A) of Section 115A of the Income-tax Act, to a person resident in India10.4010.40
i) Income by way of royalty [not being royalty of the nature referred to point g) above E] payable by Government or an Indian concern in pursuance of an agreement made by it with the Government or the Indian concern and where such agreement is with an Indian concern, the agreement is approved by the Central Government or where it relates to a matter included in the industrial policy, for the time being in force, of the Government of India, the agreement is in accordance with that policy10.4010.40
j) Income by way of fees for technical services payable by Government or an Indian concern in pursuance of an agreement made by it with the Government or the Indian concern and where such agreement is with an Indian concern, the agreement is approved by the Central Government or where it relates to a matter included in the industrial policy, for the time being in force, of the Government of India, the agreement is in accordance with that policy10.4010.40
k) Any other income31.2031.20
Section 196B: Income from units (including long-term capital gain on transfer of such units) to an offshore fund10.4010.40
Section 196C: Income from foreign currency bonds or GDR of an Indian company (including long-term capital gain on transfer of such bonds or GDR)10.4010.40
Section 196D: Income of foreign Institutional Investors from securities (not being dividend or capital gain arising from such securities)20.8020.80

Note:

(1) Surcharge on TDS:-

  • Surcharge not deductible at source in case of resident individual/ HUF /Firm/LLP/ AOP / BOI/Domestic Company in respect of payment of income other than salary.
  • Surcharge @ 10% (if total income exceeds Rs. 50 Lakhs but does not exceed Rs. 1 crore) or @15% (if total income exceeds Rs. 1 crore) is deductible along with TDS on Salary income.
  • In case of Non-resident & Foreign company, Surcharge is deductible along with TDS at the following rates.
    Non Residents other than company (if income exceeds Rs. 50 Lakh but not exceeds Rs. 1 Crore) 10% Non Residents other than company (if income exceeds Rs. 1 Crore) 15% Non Resident companies if income is between Rs. 1 Crore and 10 Crore 2% Non Resident companies if income is greater than Rs. 10 Crore 5% Surcharge on Co-operative Society & Firms in case of Non-Residents (if income exceeds Rs. 1 crore) 12%

(2) Education Cess & SHEC on TDS:-

  • Resident;- EC & SHEC is not deductible at source in case of resident Individual/HUF/Firm/ AOP/ BOI/ Domestic Company in respect of payment of income other than salary.
  • Education Cess @ 2% & SHEC @ 1% is deductible along with TDS on Salary income.
  • Non-Resident:- Education Cess @ 2% & SHEC @ 1% is deductible at source in case of non-residents and foreign company.

(3) As per circular no. 1/2014 dated 13-01-2014, No TDS is to be deducted on service tax component included in the payments made to residents.

(4) If PAN of deductee is not intimated to the deductor, TDS will be deducted either at the rate given in above table or 20%, whichever is higher (Sec. 206AA) But in case of section 192A (TDS on Employees Provident fund balance) TDS @ 30% is deducted if valid PAN is not available.

(5) Interest on late payment of TDS:

If TDS is not deducted then interst @ 1% per month or part thereof, for the period from the date on which TDS is deductible/collectible to the date on which TDS/TCS is actually deducted/collected. But if TDS is deducted but not paid then Interest @ 1.5% per month or part thereof, for the period from the date on which TDS is actually deducted/collected to the date on which such TDS/TCS is actually paid.

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