Latest TDS Rates for FY 2016-17

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Hiral Vakil

TDS
Last updated on February 15th, 2021

TDS needs to be deducted on a specific payment at a prescribed rate by the payer/deductor. Deductor is a person who is liable to deduct TDS before making payment to a deductee. Each payment has its own threshold limit and rate of a percentage to deduct TDS. The payer/deductor is also required to deposit TDS deducted to the government within due dates and file TDS Return.

TDS on Salary Payments

TDS on salary payment is deducted as per section 192 of the income tax act. It is calculated at the applicable Slab Rate. Employer/Deductor needs to deposit TDS deducted on salary before the 7th of the next month (30th April for the month of March). An employer also needs to file TDS Return in Form 24Q each quarter.

TDS on other than Salary Payments

TDS on other payments depends on the Nature of Payment. Here are the latest rates of TDS on payments other than Salary for FY 2016-17 (AY 2017-18) w.e.f 01/06/2016.

Most common TDS sections and Rates:

Section Nature of Payment Threshold Individual/HUF Others
194A Interest other than on securities by banks Rs. 10,000/- 10% 10%
194C(1) Payment to Contractors Rs. 30,000/-  single payment
Rs. 1,00,000/-  aggregate payment
1% 2%
194C(2) Payment to Subcontractors for Advertisements
194H Commission or Brokerage Rs. 15,000/- 5% 5%
194I Rent of Land, Building or Furniture Rs. 1,80,000/- 10% 10%
Rent of Plant & Machinery 2% 2%
194IA Transfer of Immovable Property (w.e.f. 01.06.2013) Rs. 50,00,000/- 1% 1%
194J Professional/technical services, royalty Rs. 30,000/- 10% 10%
 

Other TDS sections and Rates:

SectionNature of PaymentThresholdIndividual/HUFOthers
192APremature Withdrawal from EPFRs. 50,000/-10%NA
193Interest on SecuritiesRs. 5,000/-10%10%
194Deemed DividendNo Minimum Limit10%10%
194AInterest other than on securities by banksRs. 10,000/-10%10%
194BWinnings from Lotteries / Puzzle / GameRs. 10,000/-30%30%
194 BBWinnings from Horse RaceRs. 10,000/-30%30%
194DPayment of Insurance CommissionRs. 15,000/-5%5%
194EEPayment of NSS DepositsRs. 2,500/-10%10%
194FRepurchase of units by Mutual Funds / UTIAny amount20%20%
194GCommission on Sale of Lottery ticketsRs. 15,000/-5%5%
194J(1)Remuneration / commission to director of the companyAny amount10%10%
194J(ba)Any remuneration / fees / commission paid to a director of a company, other than those on which tax is deductible u/s 192.Any amount10%10%
194LACompensation on acquisition of certain immovable propertyRs. 2,00,00010%10%

TDS Rates are prescribed under the Income Tax Act,1956. However, the finance ministry of India can make changes to such rates in the Budget of a particular financial year if required.

FAQs

Who is liable to deduct TDS?

Corporates, Government Offices, and individuals to whom audit is applicable and making the above-mentioned type of payments are required to deduct TDS. However, TDS isn’t required to be deducted by Individuals and HUFs whose books don’t need auditing.

When to deduct TDS?

TDS needs to be deducted at the time of:
1. Crediting the sum to payee account or
2. Actual payment of cash or
3. Payment via cheque, draft or via any other source, Whichever is earlier.

TDS needs to be deducted on which type of payments?

TDS is applicable to Payments such as Salary, Rent, Interest, Professional Fees, Commission, Contracts, Dividend, etc.