Section 194EE and Section 194F – TDS from payment in respect of deposit under NSS and TDS from payment on account of Repurchase of units by Mutual Funds or UTI
Continuing the TDS article services, the present article tries to cover the two rarely touched topics TDS in respect of deposit under NSS (Section 194EE) and TDS on account of repurchase of units by Mutual Funds or UTI (Section 194F).
Understanding the basics of both Section 194EE and Section 194F –
Section 194EE –
This section states that the person making payment of amount referred to in section 80CCA(2)(a) is required to deduct TDS. Section 80CCA (2) (a) refers to the withdrawal of amount deposited under the National Saving Scheme etc
Section 194F –
This section contains provisions relating to the repurchase of units of Mutual Fund / Unit Trust of India. As per section 194F, the person making payment of any amount referred to in section 80CCB (2) is required to deduct TDS.
Section 80CCB (2) of the Income Tax Act refers to the amount which is invested by the assessee in the units being issued under a plan formulated under the Equity Linked Savings Scheme. The amount so invested has been allowed as a deduction, however, the amount invested (whole or part) is returned back to the assessee by the Fund / Trust either by way of repurchase of the units or on the termination of the plan.
Time of deduction of TDS –
The Deductor liable to deduct TDS as per provisions of section 194EE and section 194F is required to deduct TDS at the time of making payment of the requisite amount.
Rate of TDS –
The rate at which TDS is to be deducted under both the section 194EE and 194F are –
|Section||Rate of TDS|
Exemption limit –
1. Section 194EE– As per the said section, no TDS is to be deducted if the aggregate amount paid to the payee, during the financial year, is less than INR 2500.
2. Section 194F– There is no exemption limit provided under section 194F.
Time of deposit of TDS with the Government –
TDS deducted under Section 194EE and / or Section 194F is required to be deposited within a period of 7 days from the end of the month in which TDS is deducted. However, the TDS deducted in the month of March is to be deposited on or before 30th April.
Further, in the case of Government Deductor, TDS deducted is to be deposited on the same day in case of payment without production of a challan.
|TCS – Tax Collection at Source – A Complete Guide|
|TDS Rate Chart for Financial Year 2019-2020|
|Section 192 – TDS on Salary|
|Section 192A – TDS on Premature withdrawal from EPF|
|Section 193: TDS on Interest on Securities|
|Section 194 – TDS on dividend|
|Section 194A: TDS on interest other than interest on securities|
|Section 194B and Section 194BB – TDS|
|Section 194C – TDS on Contractors|
|Section 194D – TDS on insurance commission|
|Section 194DA – TDS in respect of Life Insurance Policy|
|Section 194E – TDS on payment to Non-resident Sportsmen or Sports Association|
|Section 194G TDS on Commission on Sale of Lottery Tickets|
|Section 194H – TDS on Commission or Brokerage|
|Section 194I of Income Tax Act, 1961 – TDS on Rent|
|Section 194IA TDS on transfer of immovable property|
|Section 194IB – TDS on Rent paid by Individual / HUF|
|Section 194LA: Payment of Compensation on acquisition of certain immovable property|
|TDS under Section 194LB, 194LBA, 194LBB and 194LBC|
|Section 194LC: TDS on income by way of interest from an Indian Company or a business trust|
|Section 194LD TDS on income by way of interest on certain bonds and Government Securities|
|Section 194J TDS on Fees for Professional or Technical Services|
|Section 194N – TDS on Cash Withdrawals|
|Section 194M: TDS on Payment of certain sum by certain Individual / HUF|
|Section 195 TDS on payment of any other sum to a non-resident|