Tax Deducted at Source guide: Know TDS rates for various incomes in FY 2024-25 – checklist – Times of India

by The Technical Blogs


TDS rates for FY 2024-25: Tax Deducted at Source (TDS) is a mechanism by which the government collects tax directly from the source of income. It applies to a variety of incomes such as salary, interest on bank deposits, commission, house rent, and dividends, among others. However, the rate of TDS deduction varies based on specific rules.
For instance, if an individual pays house rent of Rs 50,000 or more, they are required to deduct TDS at a rate of 5% before making the payment to the landlord.
It’s important to adhere to the prescribed rules regarding TDS deduction and filing TDS returns. Failure to comply can lead to penalties, and in severe cases, imprisonment is possible, states an ET report.
Abhishek Soni, co-founder of Tax2Win, was quoted as saying, “TDS rates vary depending on the nature and amount of income, as well as the status of the recipient (whether they are a resident, a non-resident, etc.). In some severe cases, the deductor may face prosecution and imprisonment for up to seven years if they wilfully fail to deduct or deposit the TDS, as stipulated under section 276B of the Income-tax Act 1961. This legal action has serious consequences and may have long-lasting implications for the deductor.”
Understanding how TDS works and knowing TDS rates
When making a payment subject to TDS, the payer must deduct a specified percentage of the amount paid. The recipient then receives a TDS certificate from the deductor, indicating the amount deducted.
For instance, in cases where monthly house rent exceeds Rs 50,000, the tenant must provide the landlord with Form 16C (TDS certificate) within 15 days from the due date of filing TDS return. Upon receiving the certificate, the deductee can claim the TDS amount as tax paid for the respective financial year. The TDS deposit reflects in the deductee’s Form 26AS and Annual Information Statement (AIS).

TDS rates for FY 2024-25

Below is a table illustrating the TDS rates applicable for salary, house rent, shares, and other prescribed transactions in the financial year 2024-25:

Section Nature of Transaction Threshold Limit (Rs) TDS Rate
192 Salary Basic exemption As per calculated TDS rate
192A Premature Withdrawal of Employee Provident Fund (EPF) 50,000 10% if PAN is provided. 20% without PAN
193 Interest on securities 5,000 10%
194 Dividend 5,000 10%
194A Interest on deposit in a bank or post office Senior Citizens- 50,000 Others- 40,000 10% for both
194B Income from lottery winnings, puzzles, card games, etc. 10,000 30%
194BA Earnings from online games No minimum threshold 30%
194BB Income from horse race winnings 10,000 30%
194D Insurance commission to individuals/companies 15,000 Individuals: 5% Companies: 10%
194DA Payment made towards life insurance policy 1,00,000 5%
194EE Payment to National Savings Scheme 2,500 10%
194F Payment for the repurchase of units by Mutual Fund or UTI No specified limit 20%
194H Commission/brokerage 15,000 5%
194-I Rent:
Plant and machinery 2,40,000 2%
Land/building/furniture/fitting 2,40,000 10%
194-IA Payment on transfer of immovable property except agricultural land 50,00,000 1%
194-IB Rent paid by HUF/Individual not required to conduct tax audit 50,000 per month 5%
194K Earnings from units payable to a resident No specified limit 10%
194LA Compensation for acquiring an immovable property 2,50,000 10%
194N Cash withdrawal exceeding specific amount Cooperative society: 3 crore 2%
Others: 1 crore
Cash withdrawal from multiple bank accounts during previous year 1 crore 2%
Aggregate cash withdrawal exceeding 20 lakhs 20 lakhs 2%
Aggregate cash withdrawal exceeding 1 crore 1 crore 5%
194P TDS for senior citizens aged over 75 years Basic exemption limit Normal tax slab rates
194S Payment of virtual digital assets Specified Persons- 50,000 Others- 10,000 1%
195 Income on investments of NRI citizens No specified limit 20%
195 LTCG under section 115E in the case of NRI citizen No specified limit 10%
195 LTCG under section 112(1)(c)(iii) No specified limit 10%
195 LTCG under section 112A No specified limit 10%
195 STCG under section 111A No specified limit 15%
195 Other LTCG other than LTCG mentioned u/s 112A, 10(33), 10(36) No specified limit 20%
196B LTCG and other income from units of an offshore fund No specified limit 10%
206AB Payment made to people not filing their ITR No specified limit 2 times the rate mentioned in the Income Tax Act or 5%, whichever is higher
206AA TDS rate if PAN not available No specified limit Rates specified or 20%, whichever is higher

Source: Abhishek Soni, co-founder, Tax2Win (a tax filing assistance company) as quoted by ET


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