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Amended TDS chart for 14-5-2020 to 31-3-2021

Reduction in rate of Tax Deduction at Source (TDS) & Tax Collection at Source (TCS)

Applicability: –

The reduction shall be applicable for the remaining F.Y. 2020-2021 i.e. from 14/05/2020 to 31/03/2021.

Benefit: –

This measure will release liquidity of Rs. 50,000 crore.

The object is to provide more funds at the disposal of the taxpayers.

Rate of Tax deduction at source (TDS) for non-salaried specified payments made to residents and rate of tax collection at source (TCS) for the specified receipts shall be reduced by 25% of the existing rates.

Related Topic:
Latest TDS/TCS Related Amendments

Eligibility: –

Payment for the contract, professional fees, interest, rent, dividend, commission, brokerage, etc. shall be eligible for this reduced rate of TDS.

1. In order to provide more funds at the disposal of the taxpayers for dealing with the economic situation arising out of COVID-19 pandemic, the rates of Tax Deduction at Source (TDS) for the following non-salaried specified payments made to residents has been reduced by 25% for the period from 14th May 2020 to 31st March 2021:-

TDS RATE CHART

S. No Section of the Income-tax
Act
Nature of Payment Existing Rate of TDS Reduced rate from 14/05/2020 to 31/03/2021
1 193 Interest on
Securities
10% 7.5%
2 194 Dividend 10% 7.5%
3 194A Interest other
than interest on
securities
10% 7.5%
4 7.5% Payment of
Contractors and
sub-contractors
1%
(individual/HUF)
2% (others)
0.75% (individual/HUF)
1.5% (others)
5 194D Insurance
Commission
5% 3.75%
6 194DA Payment in
respect for life
insurance policy
5% 3.75%
7 194EE Payments in
respect for
deposits under
National
Savings Scheme
10% 7.5%
8 194F Payments on

an account of re-
purchase of

Units by Mutual
Funds or UTI

20% 15%
9 194G Commission,
prize etc., on
sale of lottery
tickets
5% 3.75%
10 194H Commission or
brokerage
5% 3.75%
11 194-I(a) Rent for plant
and machinery
2% 1.5%
12 194-I(b) Rent for
immovable
property
10% 7.5%
13 194-IA Payment for
acquisition of
immovable
property
1% 0.75%
14 194-IB Payment of rent
by individual or
HUF
5% 3.75%
15 194-IC Payment for

Joint
Development
Agreements

10% 7.5%
16 194J Fee for
Professional or
Technical
Services (FTS),
Royalty, etc.
2% (FTS, certain
royalties, call
centre)
10% (others)
1.5% (FTS, certain
royalties, call centre)
7.5% (others)
17 194K Payment of
dividend by
Mutual Funds
10% 7.5%
18 194LA Payment of
Compensation
on acquisition
of immovable
property
10% 7.5%
19 194LBA(1) Payment of
income by
Business trust
10% 7.5%
20 194LBB(i) Payment of
income by Investment
fund
10% 7.5%
21 194LBC(1) Income by
securitisation
trust
25%
(Individual/HUF)
30% (Others)
18.75% (Individual/HUF)
22.5% (Others)
22 194M Payment to
commission,
brokerage etc.
by Individual
and HUF
5% 3.75%
23 194-O TDS one-
commerce

participants

1%
(w.e.f. 1.10.2020)
 0.75%

 

2. Further, the rate of Tax Collection at Source (TCS) for the following specified receipts has also
been reduced by 25% for the period from 14th May 2020 to 31st March 2021:

TCS RATE CHART

Screenshot (117)

Screenshot (118)

3. Therefore, TDS on the amount paid or credited during the period from 14th May 2020 to 31st March 2021 shall be deducted at the reduced rates specified in the table in para 1 above. Similarly, the tax on the amount received or debited during the period from 14th May 2020 to 31st March 2021 shall be collected at the reduced rates specified in the table in para 2 above.

4. It is further stated that there shall be no reduction in rates of TDS or TCS, where the tax is required to be deducted or collected at a higher rate due to non-furnishing of PAN/Aadhaar. For example, if the tax is required to be deducted at 20% under section 206AA of the Income-tax Act due to non-furnishing of PAN/Aadhaar, it shall be deducted at the rate of 20% and not at the rate of 15%.

5. Legislative amendments in this regard shall be proposed in due course.

Download the copy:

Amended TDS chart for 14-5-2020 to 31-3-2021

 

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