Revised TDS/TCS Rate Applicable As Per Covid Economic Relief Package Applicable For All Kinds Of Payments W.E.F. 14th May 2020.
Union Minister of Finance & Corporate Affairs Smt. Nirmala Sitharaman has announced today Reduction in Rates of Tax Deduction at Source (TDS) and ‘Tax Collected at Source (TCS). The TDS rates for payment to residents other than Salary, and tax collected at source rate will be reduced by 25 percent of the specified rates for the remaining period of FY 2020-21 i.e. from 14.05.2020 to 31.03.2021.
Though, in the speech by the Hon. Finance Minister, she mentioned that TDS rates shall be reduced on all types of payments made, a press release by the Government late night has given the list of Sections where the reduced rates are applicable. The TDS will be continued to be charged at original rates on all other sections as also to all payments made to non-residents.
TDS Rate Chart for F.Y. 2020-21 (A.Y: 2021-22) after considering changes w.e.f. 14.05.2020
Kindly Note amended rates are been given on the basis of PIB Notification dated 13.05.2020 and on the date of Publication of this post no notification in this regard is been notified by the CBDT. Press release can be accessed at the following link- https://pib.gov.in/PressReleasePage.aspx?PRID=1623745
| Section | Nature of payment | Threshold Limit | Till 13/05/2020 | From 14/05/2020 | ||
| Resident | Non-resident* | Resident | Non-resident* | |||
| Rs. | TDS Rate (%) | TDS Rate (%) | TDS Rate (%) | TDS Rate (%) | ||
| 192 | Salaries | – | Normal slab rate | Normal slab rate | Normal slab rate | Normal slab rate |
| 192A | Premature withdrawal from EPF | 50000 | 10 | 10 | 10 | 10 |
| 193 | Interest on securities – 8% Savings (Taxable) Bonds, 2003 or 7.75% Savings (Taxable) Bonds, 2018 during the financial year | 10000 | 10 | 0 | 7.5 | 0 |
| 193 | Interest on securities – Interest on securities for money issued by or on behalf of any local authority/ statutory corporation, listed debentures of a company (other than demat form), any other interest on securities | Rs. 5000 in case of Individual | 10 | – | 7.5 | – |
| 194 | Dividends | 5000 | 10 | – | 7.5 | – |
| 194A | Interest (Banking co., co-operative society engaged in banking, post office) | 50000 | 10 | – | 7.5 | – |
| 194A | Interest (Any other person) | 5000 | 10 | – | 7.5 | – |
| 194B | Winning from lotteries | 10000 | 30 | 30 | 30 | 30 |
| 194BB | Winning from Horse race | 10000 | 30 | 30 | 30 | 30 |
| 194C | Contractor-Single transaction-Individual/HUF | 30000 | 1 | – | 0.75 | – |
| -Others | 2 | 0- | 1.5 | – | ||
| 194C | Contractor – Consolidated Payment During the F.Y. | 100000 | ||||
| – Individual/HUF | 1 | – | 0.75 | 0- | ||
| – Others | 2 | – | 1.5 | – | ||
| 194C | Transporter (44AE) declaration with PAN | – | 0 | 0 | 0 | 0 |
| 194D | Insurance commission – Other than Company | 15000 | 5 | 0 | 3.75 | 0 |
| – Company | 10 | 0 | 7.5 | 0 | ||
| 194DA | Maturity of Life insurance policy | 100000 | 5 | 0 | 3.75 | 0 |
| 194E | Non-resident sportsmen or sports association | – | NA | 20 | NA | 20 |
| 194EE | NSS | 2500 | 10 | 10 | 7.5 | 10 |
| 194F | Repurchase units by MFs | – | 20 | 20 | 15 | 20 |
| 194G | Commission-Lottery | 15000 | 5 | 5 | 3.75 | 5 |
| 194H | Commission /Brokerage | 15000 | 5 | 0 | 3.75 | 0 |
| 194I | Rent of – Plant/Machinery/Equipment | 240000 | 2 | 0 | 1.5 | – |
| – Land and Building/Furniture & Fixture | 10 | 0 | 7.5 | – | ||
| 194IA | Transfer of certain immovable property other than agriculture land | 50 lakh | 1 | 0 | 0.75 | – |
| 194IB | Rent by Individual/HUF | 50000 per month | 5 | 0 | 3.75 | – |
| 194IC | Payment under Joint Development Agreements to Individual/HUF | – | 10 | 0 | 7.50 | 0 |
| 194J | Professional Fees | 30000 | 10 | 0 | 7.5 | 0 |
| 194J | Technical Fees (w.e.f. 01.04.2020) | 30000 | 2 | 0 | 1.5 | 0 |
| 194J | Payment to call centre operator (w.e.f. 01.06.2017) | 30000 | 2 | 0 | 1.5 | 0 |
| 194J | Director’s fees | NIL | 10 | 0 | 7.5 | 0 |
| 194K | Payment of any income in respect of | 5000 | 10 | 0 | 7.5 | 0 |
| (a) units of a mutual fund as per section 10(23D); or | ||||||
| (b) the units from the administrator; or | ||||||
| (c) units from specified company | ||||||
| (w.e.f. 01.04.2020) | ||||||
| 194LA | Compensation on transfer of certain immovable property other than agriculture land | 250000 | 10 | 0 | 7.5 | 0 |
| (TDS exempted if covered under RFCTLARR Act w.e.f. 01.04.2017) | ||||||
| 194LB | Income by way of interest from infrastructure debt fund | – | 0 | 5 | 0 | 5 |
| 194LBA | Income from units of business trust | |||||
| – interest received or receivable from a special purpose vehicle; or | – | 10 | 5 | 7.5 | 5 | |
| – dividend referred to in sub-section (7) of section 115-O | 10 | 10 | 7.5 | 10 | ||
| 194LBA | Distribution of rental income to unit holders | – | ||||
| – Other than Company | 10 | 30 | 7.5 | 30 | ||
| – Company | 10 | 40 | 7.5 | 40 | ||
| 194LBB | Income in respect of units of investment fund | – | ||||
| – Other than Company | 10 | 30 | 7.5 | 30 | ||
| – Company | 10 | 40 | 7.5 | 40 | ||
| 194LBC | Income in respect of investment in securitization fund | – | ||||
| – Individual/HUF | 25 | 30 | 18.75 | 30 | ||
| – Company | 30 | 40 | 22.5 | 40 | ||
| – Other Person | 30 | 30 | 22.5 | 30 | ||
| 194LC | Income by way of interest by an Indian specified company to a non-resident/foreign company on foreign currency approved loan / long-term infrastructure bonds from outside India | – | 0 | 5 | 0 | 5 |
| 194LC | Income by way of interest by an Indian specified company on rupee denominated bond / any long-term bonds from outside India, which is listed only on a recognized stock exchange located in any International Financial Services Centre | – | 0 | 4 | 0 | 4 |
| 194LD | Interest on certain bonds from Govt. securities | – | 0 | 5 | 0 | 5 |
| 194M | Certain payments by Individual/HUF | 50 lakh | 5 | 0 | 3.75 | 0 |
| 194N | Payment of certain amount in cash | 1 Crore | 2 | 2 | 2 | 2 |
| 194N | Payment of certain amount in cash (first proviso of section 194N- assessee has not furnished return for last 3 assessment years ) if- |
20 Lakh | ||||
| – Amount is more than Rs.20 lakh but up to Rs. 1 crore | 2 | 2 | 2 | 2 | ||
| – Amount exceeds Rs. 1 crore | 5 | 5 | 5 | 5 | ||
| 194-O | Applicable for e-commerce operator for the sale of goods or provision of services facilitated by it through its digital or electronic facility or platform (w.e.f. 01.04.2020) | – | 1 | 0 | 0.75 | 0 |
| 195 | Income of Investment made by an NRI | – | 0 | 20 | 0 | 20 |
| 195 | Long-term capital gain | – | ||||
| – Under Section – 115E/112(1)(c)(iii)/112A | 0 | 10 | 0 | 10 | ||
| – Any Other Gains | 0 | 20 | 0 | 20 | ||
| 195 | Short-term capital gain – 111A | – | 0 | 15 | 0 | 15 |
| 195 | Royalty | – | 0 | 10 | 0 | 10 |
| 195 | Fees for technical services | – | 0 | 10 | 0 | 10 |
| 195 | Interest income payable by Govt./Indian concern (other than section 194LB or 194LC) | – | 0 | 20 | 0 | 20 |
| 195 | Any Other Income – Other than Company | – | 0 | 30 | 0 | 30 |
| – Company | 0 | 40 | 0 | 40 | ||
| 196A | Income in respect – | – | 0 | 20 | 0 | 20 |
| – of units of a Mutual Fund specified under clause (23D) of section 10; or | ||||||
| – from the specified company referred to in the Explanation to clause (35) of section 10 | ||||||
| 196B | Income from units to an offshore fund | – | 0 | 10 | 0 | 10 |
| 196C | Income from foreign currency bonds or GDR of an Indian company | – | 0 | 10 | 0 | 10 |
| 196D | Income of foreign Institutional Investors from securities (not being interest referred to in section 194LD, not being dividend referred in section 115-O, not being capital gain from transfer of securities referred in section 115AD) | – | 0 | 20 | 0 | 20 |
| * TDS rate shall be increased by applicable surcharge and Health & Education Cess. | ||||||
No Reduction in rate of TDS where the tax is required to be deducted at higher rate due to non furnishing of PAN/ Aadhaar.
TDS rates for Salaried persons and Non Resident Persons shall remain unchanged and old rates shall apply as usual.
The TDS on the amount paid or credited during the period from 14th May 2020 to 31st March 2021 shall be deducted at the reduced new rates as specified in the above table. Similarly the tax on the amount received and debited during the period from 14th May 2020 to 31st March 2021 shall be collected at new rates as specified in the table.
This relaxation only applies to payment made between 14th May 2020 and 31st March 2021. So this will not cover payments made before 14th May 2020.
TCS Rate Chart for F.Y. 2020-21 (A.Y: 2021-22) after considering changes w.e.f. 14.05.2020
| Section | Nature of payment | Till 13/05/2020 | From 14/05/2020 |
| TCS Rate (%) | TCS Rate (%) | ||
| 206C | Scrap | 1 | 0.75 |
| 206C | Tendu leaves | 5 | 3.75 |
| 206C | Timber obtained under a forest lease or other mode | 2.5 | 1.875 |
| 206C | Any other forest produce not being a timber or tendu leaves | 2.5 | 1.875 |
| 206C | Alcoholic liquor for human consumption and Indian made foreign liquor | 1 | 1 |
| 206C | Parking lot, toll plaza, mining and quarrying (other than mining and quarrying of mineral oil, petroleum and natural gas) | 2 | 1.5 |
| 206C | Minerals, being coal or lignite or iron ore | 1 | 0.75 |
| 206C | Sale of motor vehicle of the value exceeding Rs. 10 Lacs | 1 | 0.75 |
| 206C | Remittance out of India under the Liberalized Remittance Scheme of the RBI of the value exceeding 7 Lacs in a financial year | 5% (Wef 01.10.2020) | 5% (Wef 01.10.2020) |
| 206C | Sale of overseas tour programme package | 5% (Wef 01.10.2020) | 5% (Wef 01.10.2020) |
| 206C | Remittance out of India for education under the Liberalized Remittance Scheme of the RBI of the value exceeding 7 Lacs in a financial year | 0.5%: Where remittance is a repayment of loan obtained for the purpose of pursuing any education. – 5% In any other (wef 01.10.2020) |
0.5%: Where remittance is a repayment of loan obtained for the purpose of pursuing any education.
– 5% : In any other case. (wef 01.10.2020) |
| 206C | Sale of any goods (other than goods exported out of India or goods given in the above points) of the value exceeding 50 Lacs | 0.1 (Wef 01.10.2020) | 0.075 (Wef 01.10.2020) |
No Reduction in rate of TCS where the tax is required to be collected at higher rate due to non-furnishing of PAN/ Aadhaar.
Compiled By M/S. Sanjay Thampy & Associates, Chartered Accountants
Please note article is been amended after publication to give effect to press release issued by Ministry of Finance.
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Author Bio
Given instruction to service provider – deduct TDS as per new revised rates, but they are deducting OLD rates & replied that “There is no notification issued for deduction of TDS @7.5% instead of 10% in press release”. How we reply to this query???
HelloSir,
What should be the rate of TDS applicable in the below scenario?
1. Date of invoice 30.6.2020
2. Old LDC valid till 30.6.2020 @ 6%
3. Reducted Tax rates effective July 2020 u/s 194J 7.5%
4. New LDC received valid from 2nd July 2020-31.3.2020 @ 0.15%
Sir, I have purchased resale flat in June20 and i have deducted 1%TDS while paying to seller. When i tried to pay TDS in site, its 0.75%. Is TDS is revised? Kindly reply as seller is asking for 0.25% refund. Should i go ahead and refund 0.25%? Or is it like this revision is temporary and i may have to pay 0.25% later? Kindly help
what will be the TDS rate for amount & bookings received through e-commerce website for online tuition/workshops services? For ex:. Website A is taking Bookings & Money from parents and forward 100% amount to proprietorship institute (main service provider).