SEC-194N- TDS ON CASH WITHDRAWAL (inserted w.e.f. 01.09.2019)
(ii) a cooperative society carrying on business of banking
(iii) a post office
who is responsible to pay, in cash, any sum or aggregate of sums exceeding 1 crore rupees during the previous year, to any person (recipient) from one or more accounts maintained by the recipient, shall deduct TDS @ 2% of sum exceeding Rs. 1 Crore.
The section will apply to withdrawals made by any taxpayer including: (Recipient)
(a) An Individual
(b) A Hindu Undivided Family (HUF)
(c) A Company
(d) A partnership firm or an LLP
(e) A local authority
(f) An Association of Person (AOPs) or Body of Individuals (BOIs)
Deduction to be made at the time of payment of such sum.
Deduction of TDS will not be applicable if payment made to the following persons: (Recipient)
(i) Any government body
(ii) Any bank including co-operative banks
(iii) Any business correspondent of a banking company (including co-operative banks)
(iv) Any white label ATM operator of any bank (including co-operative banks)
(v) Any other person notified by the government
Person to whom credit is given for tax deducted and paid
For the purpose of SEc 194N, credit is to be given to the person from whose account tax has been deducted and paid to the CG for the relevant previous year in which such deduction is made.
There are two options :
(i) Cash withdrawal before 01.09.2019 < Rs. 1 Crore – Then TDS @ 2% will be deducted when the aggregate withdrawal amount crosses Rs. 1 Crore.
(ii) Cash Withdrawal before 01.09.2019 > Rs 1 Crore – Then TDS @ 2% is to be deducted on amount paid after 01.09.2019 on all subsequent withdrawals.
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