Tax Deducted at Source (TDS) is a mechanism that has been introduced by the Income Tax Department. Under this, the responsible person is supposed to deduct a certain percentage of income as tax before making the payment to the receiver. The payment includes salary, commission, professional fees, interest, rent, etc.
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 non-salaried specified payments made to residents has been reduced by 25% for the period from 14 May 2020 to 31 March 2021
However, there shall be no reduction in rates, where tax is required to be deducted or collected at a higher rate due to the non-furnishing of PAN/Aadhaar.
