Sec 194N: Tds on cash withdrawal of more than 1 crore
Section 194N is made applicable from 1-09-2019. Section 194N provides that the tax shall be required to be deducted only when the aggregate amount of cash withdrawn by a person during the previous year, from one or more of his bank or post office account, exceeds Rs. 1 Crore. Hence, for the purpose of computation of threshold limit of Rs. 1 crore, the total amount of cash withdrawn during the previous year shall be considered. However CBDT has issued a press release dated 30-08-19, any withdrawal made prior to 1st September 19 doesn’t comes under this purview. For calculation of 1 crore limit the withdrawal made before Sep 1 is also to be considered.
For Eg : If a person X withdraws 1 crore before 30-8-19, then 2% TDS will be deducted thereafter on all the amounts.
Who is liable to deduct TDS:
No tax shall be required to be deducted if cash withdrawal from bank or post office is made by the following recipients:
1. Central or State Government
3. Co-op. Banks
4. Post Office
5. Banking correspondents
6. White label ATM operators
7. Other persons notified by the Govt. in consultation with the RBI.
1) The section specifically mentioned one or more accounts maintained in a banking company. It means if a person maintains a savings and current account, the threshold limit for calculating 1 crore/20Lakh (As Applicable) should be of aggregating amounts withdrawn in both accounts cumulatively.
2) If a person maintains current and savings accounts in different banks then he can withdraw 2*1 crore = 2 crores without TDS.