TDS Rate Chart for FY 2022-2023 (AY 2023-2024) including Budget 2022 Amendments
Tax Deduction at Source (TDS) is one of the important compliances for Income Tax Assessee. There are various sections in Income Tax Law, which specify different TDS rates, nature of payment & its threshold limits for TDS. Every year when the Budget is presented by FM, under Direct Tax Proposals, various changes in respect of TDS/TCS are also introduced. In Budget 2022, major changes have been proposed viz. TDS on payment for transfer of virtual digital asset, TDS on Sale of Immovable Property (Higher of Stamp Duty Valuation & Sales Consideration), Higher TDS Rates for Non-Filers of ITR (Reduced Period of 1 year) and TDS on benefit or perquisite of a business or profession. In this article, various TDS rates applicable for FY 2022-2023 (AY 2023-2024) i.e. for the period from 01.04.2022 to 31.03.2023 have been presented in Tabular Form along with explanation of Budget 2022 changes in respect of TDS.
|Section||Nature of Payment||Threshold||TDS Rate||Remarks|
|192||Salary||Taxable Income liable to Tax||Normal Slab Rate
New Tax Regime Slab Rate as opted by employee
|Refer Note 1 for Slab Rates|
|192A||Payment of accumulated balance of provident fund which is taxable in the hands of an employee.||50,000||10%||–|
|193||Interest on securities||2,500||10%||–|
|194A||Interest on Bank Deposit/Post Office Deposit/Banking Co-Society Deposit
(Interest other than “Interest on securities” )
|a) Senior Citizen||50,000||10%||–|
|194A||Interest other than “Interest on securities”
(Other Than Bank Deposit/Post Office Deposit/Banking Co-Society Deposit)
|194B||Winnings from lotteries, crossword puzzles, card games and other games of any sort||10,000||30%||–|
|194BB||Winnings from horse races||10,000||30%||–|
|194C||Payment to contractor/sub-contractor:||Single Transaction: 30,000 & Aggregate of Transactions: 1,00,000||–|
|194DA||Payment in respect of life insurance policy, the tax shall be deducted on the amount of income comprised in insurance pay-out||1,00,000||5%||–|
|194E||Payment to non-resident sportsmen/sports association||–||20%||The rate of TDS shall be increased by applicable surcharge and Health & Education cess.|
|194EE||Payment in respect of deposit under National Savings scheme||2,500||10%||–|
|194F||Payment on account of repurchase of unit by Mutual Fund or Unit Trust of India||–||20%||–|
|194G||Commission on sale of lottery tickets||15,000||5%||–|
|194H||Commission or brokerage||15,000||5%||–|
|194-I(a) Plant & Machinery||2,40,000||2%||–|
|194-I(b) Land or building or furniture or fitting||2,40,000||10%||–|
|194-IA||Payment on transfer of certain immovable property other than agricultural land||50 Lakh||1%||Budget 2022 Update
Refer Note 2
|194-IB||Payment of rent by individual or HUF not liable to tax audit||50,000 per month||5%||–|
|194-IC||Payment of monetary consideration under Joint Development Agreements||–||10%||–|
|194J||Fees for professional or technical services:|
|i) sum paid or payable towards fees for technical services||30,000||2%||–|
|ii) sum paid or payable towards royalty in the nature of consideration for sale, distribution or exhibition of cinematographic films;||30,000||2%||–|
|iii) Any other sum||30,000||10%||–|
|194K||Income in respect of units payable to resident person||–||10%||–|
|194LA||Payment of compensation on acquisition of certain immovable property||2,50,000||10%||–|
|194LB||Payment of interest on infrastructure debt fund to Non Resident||–||5%||The rate of TDS shall be increased by applicable surcharge and Health & Education cess.|
|194LBA(1)||Business trust shall deduct tax while distributing, any interest received or receivable by it from a SPV or any income received from renting or leasing or letting out any real estate asset owned directly by it, to its unit holders.||–||10%||–|
|194LBB||Investment fund paying an income to a unit holder [other than income which is exempt under Section 10(23FBB)]||–||10%||–|
|194LBC||Income in respect of investment made in a securitisation trust (specified in Explanation of section115TCA)|
|194M||Payment of commission (not being insurance commission), brokerage, contractual fee, professional fee to a resident person by an Individual or a HUF who are not liable to deduct TDS under section 194C, 194H, or 194J.||50 Lakh||5%||–|
|194N||Cash withdrawal during the previous year from one or more account maintained by a person with a banking company, co-operative society engaged in business of banking or a post office:|
|i) in excess of Rs. 1 crore||1 Crore||2%||–|
|ii) in excess of Rs. 20 lakhs (for those persons who have not filed return of income (ITR) for three previous years immediately preceding the previous year in which cash is withdrawn, and the due date for filing ITR under section 139(1) has expired.) The deduction of tax under this situation shall be at the rate of:|
|a) On amount withdrawn in cash if the aggregate of the amount of withdrawal exceeds Rs. 20 lakhs during the previous year;||20 Lakh||2%||–|
|b) On amount withdrawn in cash if the aggregate of the amount of withdrawal exceeds Rs. 1 crore during the previous year;||1 Crore||5%||–|
|194-O||Payment or credit of amount by the e-commerce operator to e-commerce participant||5 Lakh||1%||In case of non-availability of PAN, TDS Rate shall be 5%|
|194Q||Purchase of goods (applicable w.e.f 01.07.2021)||50 Lakh||0.10%||–|
|195||Payment of any other sum to a Non-resident||The rate of TDS shall be increased by applicable surcharge and Health & Education cess.|
|a) Income in respect of investment made by a Non-resident Indian Citizen||–||20%||–|
|b) Income by way of long-term capital gains referred to in Section 115E in case of a Non-resident Indian Citizen||–||10%||–|
|c) Income by way of long-term capital gains referred to in sub-clause (iii) of clause (c) of sub-Section (1) of Section 112||–||10%||–|
|d) Income by way of long-term capital gains as referred to in Section 112A||–||10%||–|
|e) Income by way of short-term capital gains referred to in Section 111A||–||15%||–|
|f) Any other income by way of long-term capital gains [not being long-term capital gains referred to in clauses 10(33), 10(36) and 112A||–||20%||–|
|g) Income by way of interest payable by Government or an Indian concern on moneys borrowed or debt incurred by Government or the Indian concern in foreign currency (not being income by way of interest referred to in Section 194LB or Section 194LC)||–||20%||–|
|h) Any other Income||–||30%||–|
|194P||TDS on Senior Citizen above 75 Years||Taxable Income liable to Tax||Tax Rates in Force||Refer Note 1 for Slab Rates|
|206AB||TDS on non-filers of ITR at higher rates||
Refer Note 3
Higher of the followings rates –
|Budget 2022 Update
Refer Note 3
|206AA||TDS rate in case of Non availability of PAN
|As per respective section||Tax shall be deducted at the higher of the following rates, namely:—
(i) at the rate specified in the relevant provision of this Act; or
(ii) at the rate or rates in force; or
(iii) at the rate of 20%
|194R||TDS on benefit or perquisite of a business or profession||20,000||10%||Introduced in Budget 2022
Refer Note 4
|194S||TDS on payment for Virtual Digital Assets||“Specified Person” Payer– 50,000
Other Payers – 10,000
|1%||Introduced in Budget 2022
Refer Note 5
Note 1: Basic Slab Rates for AY 2023-2024
|Net Income Range||Rate of Income Tax|
|1.1 Individuals (Other than senior and super senior citizen)|
|Up to Rs. 2,50,000||–|
|Rs. 2,50,000 to Rs. 5,00,000||5%|
|Rs. 5,00,000 to Rs. 10,00,000||20%|
|Above Rs. 10,00,000||30%|
|1.2 Individuals (Senior Citizen)|
|Up to Rs. 3,00,000||–|
|Rs. 3,00,000 to Rs. 5,00,000||5%|
|Rs. 5,00,000 to Rs. 10,00,000||20%|
|Above Rs. 10,00,000||30%|
|1.3 Individuals (Super Senior Citizen)|
|Up to Rs. 5,00,000||–|
|Rs. 5,00,000 to Rs. 10,00,000||20%|
|Above Rs. 10,00,000||30%|
b. Surcharge:Surcharge is levied on the amount of income-tax at following rates if total income of an assessee exceeds specified limits:-
|Range of Income||Rs. 50 Lakhs to Rs. 1 Crore||Rs. 1 Crore to Rs. 2 Crores||Rs. 2 Crores to Rs. 5 Crores||Exceeding Rs. 5 crores|
c. Health and Education Cess :Health and Education Cess is levied at the rate of 4% on the amount of income-tax plus surcharge.
d. Rebate u/s.87A
A resident individual (whose net income does not exceed Rs. 5,00,000) can avail rebate under section 87A. It is deductible from income-tax before calculating education cess. The amount of rebate is 100 per cent of income-tax or Rs. 12,500, whichever is less.
e. New Tax Regime Slab for AY 2023-2024
The Finance Act, 2020, has provided an option to Individuals and HUF for payment of taxes at the following reduced rates from Assessment Year 2021-22 and onwards:-
|Total Income (Rs)||Rate|
|Up to 2,50,000||Nil|
|From 2,50,001 to 5,00,000||5%|
|From 5,00,001 to 7,50,000||10%|
|From 7,50,001 to 10,00,000||15%|
|From 10,00,001 to 12,50,000||20%|
|From 12,50,001 to 15,00,000||25%|
1) Surcharge and Health & Education Cess as well as Rebate u/s.87A: Same as Rates applicable to Individuals given above
2) The option to pay tax at lower rates shall be available only if the total income of assessee is computed without claiming specified exemptions or deductions
Note 2: Rationalization of provisions of TDS on sale of immovable property
Applicability: These amendments will take effect from 1st April,2022.
a) Before Budget 2022 Amendment
Section 194-IA of the Act provides for deduction of tax on payment on transfer of certain immovable property other than agricultural land.
Sub-section (1) of the said section provides for deduction of tax by any person responsible for paying to a resident any sum by way of consideration for transfer of any immovable property (other than agricultural land) at the time of credit or payment of such sum to the resident at the rate of one per cent. of such sum as income-tax thereon.
Sub-section (2) provides that no deduction of tax shall be made where the consideration for the transfer of an immovable property is less than fifty lakh rupees.
b) Proposed Amendment in Budget 2022
As per the provisions of the said section, TDS is to be deducted on the amount of consideration paid by the transferee to the transferor. This section does not take into account the stamp duty value of the immovable property, whereas, as the provisions of section per 43CA and 50C of the Act, for the computation of income under the head “Profits and gains from business or profession” and “capital gains” respectively, the stamp duty value is also to be considered. Thus there is inconsistency in the provisions of section 194-IA and sections 43CA and 50C of the Act.
In order to remove inconsistency, it is proposed to amend section 194-IA of the Act to provide that in case of transfer of an immovable property (other than agricultural land), TDS is to be deducted at the rate of one per cent of such sum paid or credited to the resident or the stamp duty value of such property, whichever is higher. In case the consideration paid for the transfer of immovable property and the stamp duty value of such property are both less than fifty lakh rupees, then no tax is to be deducted under section 194-IA.
Stamp duty value shall have the meaning assigned to it in clause (f) of the Explanation to clause (vii) of sub-section (2) of section 56.
Note 3 : Section 206AB – TDS on non-filers of ITR at higher rates (Introduced in Budget 2021 & Amended in Budget 2022)
To widen and deepen the tax-base and to nudge taxpayers to furnish their return of income, Finance Act, 2021 inserted sections 206AB and 206CCA in the Act. The said sections provide for special provision for deduction and collection of tax at source respectively, in case of specified persons at higher rates specified therein, in case of non-furnishing of ITR by deductee.
Specified person as per Finance Act, 2021 (i.e. Before Budget 2022 amendment)
“Specified person” has been defined to mean a person
Further, the provisions of section 206AB are not applicable in relation to transactions on which tax is to be deducted under sections 192, 192A, 194B, 194BB, 194LBC or 194N of the Act.
Budget 2022 Amendment
Applicability: These amendments will take effect from 1st April,2022.
a) Reduced Time Period
To ensure that all the persons in whose case significant amount of tax has been deducted do furnish their return of income, it is proposed to reduce two years requirement to one year by amending sections 206AB and 206CCA of the Act to provide that “specified person” to mean as a person who has not filed its return of income for the assessment year relevant to the previous year immediately preceding the financial year in which tax is to be deducted or collected, as the case may be, and the amount of tax collected and deducted at source is Rs. 50,000 or more in the said previous year
b) Relaxation to certain persons
To reduce the additional burden on individual and Hindu undivided family (HUF) taxpayers covered under section 194-IA, 194-IB and 194M of the Act for whom simplified tax deduction system has been provided without requirement of TAN, it is proposed that the provisions of section 206AB will not apply in relation to transactions on which tax is to be deducted under the said sections of the Act.
Further, as a consequential amendment in section 194-IB it is also proposed to omit the reference of section 206AB from sub-section (4) of the said section.
c) Rectification of Drafting Errors
In addition to above, it is also proposed to rectify a drafting error in sections 206AB and 206CCA wherein the terms “deductor” and “collectee” respectively were used incorrectly.
Further, since the returns are now being furnished electronically, it is also proposed that in place of ‘filing’ of return, the term ‘furnishing’ of return may be substituted.
Note 4 : Section 194R – TDS on benefit or perquisite of a business or profession
a) Motive behind introducing New Section
As per clause (iv) of section 28 of the Act, the value of any benefit or perquisite, whether convertible into money or not, arising from business or exercise of profession is to be charged as business income in the hands of the recipient of such benefit or perquisite. However, in many cases, such recipient does not report the receipt of benefits in their return of income, leading to furnishing of incorrect particulars of income.
b) New Section 194R
Accordingly, in order to widen and deepen the tax base, it is proposed to insert a new section 194R to the Act to provide that:-
For the purpose of this section, the expression ‘person responsible for providing’ has been proposed to mean a person providing such benefit or perquisite or in case of a company, the company itself including the principal officer thereof.
Further, the provisions of the said section shall not apply to an individual or a Hindu undivided family, whose total sales, gross receipts or turnover does not exceed one crore rupees in case of business or fifty lakh rupees in case of profession during the financial year immediately preceding the financial year in which such benefit or perquisite, as the case may be, is provided.
d) Deduction of Tax
Further, in a case where the benefit or perquisite, as the case may be, is wholly in kind or partly in cash and partly in kind but such part in cash is not sufficient to meet the liability of deduction of tax in respect of whole of such benefit or perquisite, the person responsible for providing such benefit of perquisite shall, before releasing the benefit or perquisite, ensure that tax has been paid in respect of the benefit or perquisite.
e) Threshold Limit for Tax Deduction
No tax is to be deducted if the value or aggregate value of the benefit or perquisite paid or likely to be paid to a resident does not exceed twenty thousand rupees during the financial year.
This amendment will take effect from 1st July,2022
Note 5 : Section 194S – TDS on payment for Virtual Digital Assets
a) Introduction of New Section 194S
In order to widen the tax base from transactions so carried out in relation to the Virtual Digital Assets, it is proposed:-
b) Payment in Kind/Exchange
In case the payment for such transfer is–
(i) wholly in kind or in exchange of another virtual digital asset where there is no part in cash; or
(ii) partly in cash and partly in kind but the part in cash is not sufficient to meet the liability of deduction of tax in respect of whole of such transfer,
the person before making the payment shall ensure that the tax has been paid in respect of such consideration.
c) Threshold Limit
i) In case of specified persons, the provisions of section 203A and 206AB will not be applicable.
ii) Further, no tax is to be deducted in case the payer is the specified person and the value or the aggregate of such value of consideration to a resident is less than Rs. 50,000 during the financial year.
iii) In any other case, the said limit is proposed to be Rs. 10,000 during the financial year.
iv) It is also proposed to provide that if tax has been deducted under section 194S, then no tax is to be collected or deducted in respect of the said transaction under any other provision of Chapter XVII of the Act.
v) Furthermore, in any sum paid for transfer of virtual digital asset is credited to any account, whether called “Suspense Account” or by any other name, in the books of account of the person liable to pay such sum, such credit of the sum shall be deemed to be the credit of such sum to the account of the payee and the provisions of section 194S shall apply accordingly.
vi) It is proposed to empower the Board to issue guidelines, with the prior approval of the Central Government, to remove any difficulty arising in giving effect to the provisions of the said section and every such guideline issued by the Board shall be laid before each House of Parliament, and shall be binding on the income-tax authorities and on the person responsible for paying the consideration on transfer of such virtual digital assets.
vii) It is also proposed to provide that in case of a transaction where tax is deductible under section 194-O along with the proposed section 194S, then the tax shall be deducted under section 194S and not section 194-O.
d) Definition of Specified Person
For the purposes of the said section, it is proposed to provide that ‘specified person’ means a person:–
i) being an individual or Hindu undivided family whose total sales, gross receipts or turnover from the business carried on by him or profession exercised by him does not exceed one crore rupees in case of business or fifty lakh rupees in case of profession, during the financial year immediately preceding the financial year in which such virtual digital asset is transferred;
ii) being an individual or Hindu undivided family having income under any head other than the head ‘Profits and gains of business or profession’.
e) Definition of Virtual Digital Assets
To define the term “virtual digital asset”, a new clause (47A) is proposed to be inserted to section 2 of the Act. As per the proposed new clause, a virtual digital asset is proposed to mean any information or code or number or token (not being Indian currency or any foreign currency), generated through cryptographic means or otherwise, by whatever name called, providing a digital representation of value which is exchanged with or without consideration, with the promise or representation of having inherent value, or functions as a store of value or a unit of account and includes its use in any financial transaction or investment, but not limited to, investment schemes and can be transferred, stored or traded electronically. Non fungible token and; any other token of similar nature are included in the definition.
This amendment will take effect from 1st of July, 2022
TDS Rates compiled by: CA. Sagar Gambhir | FCA, DISA (ICAI), DIRM (ICAI), B.COM | [email protected]
Author can be reached at [email protected] for any queries, issues & recommendations relating to article.
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