The Finance Minister Nirmala Sitharaman announced the financial relief package for the country amidst the COVID-19 crisis, as a part of Atmanirbhar Bharat vision of Prime Minister Narendra Modi (Read about package announcements here). The package also revised TDS rates downward by 25% for FY 2020-21 from 14th May 2020 till 31st March 2021 that is expected to boost the liquidity. TDS rates have only been reduced for non-salaried payments, while TDS on salaries will continue to be deducted as per the slab rate.
The revised TDS rates for FY 2020-21 are as follow:
| Nature of Payment | Basic Cut off (Rs.) | Individual /Company and others New Rate %) | Individual /Company and others (Old Rate %) | If No Pan or Invalid PAN (Rate %) |
| 192 – Salaries | Slab Rate | Slab Rates | Slab Rates | 22.5% |
| 192A- Premature withdrawal from Employee Provident Fund | 50000 | Individual: 7.5% Company: NA | Individual: 10% Company: NA | 15% |
| 193 – Interest on securities | – | Individual: 7.5% Company: 7.5% | Individual: 10% Company: 10%` | 15% |
| 194 – Dividend other than the dividend as referred to in Section 115-O | 2500 | Individual: 7.5% Company: 7.5% | Individual: 10% Company: 10% | 15% |
| 194A – Interest other than interest on securities – Others | 40000 (for individual) | Individual: 7.5% | Individual: 10% Company: 10% | 15% |
| 194A – Banks (Deposits) | 40000 (for individual) 50000 (for Senior Citizens only) | Company: 7.5% | Individual: 10% Company: 10% | 15% |
| 194B – Winning from Lotteries and Horse Races | 10000 | Individual: 22.5% Company: 22.5% | Individual: 30% Company: 30% | 22.5% |
| 194C- Payment to Contractor – Single Transaction | 30000 | Individual: 0.75% Company: 1.5% | Individual: 1% Company: 2% | 15% |
| 194C-Payment to Contractor – Aggregate During the Financial year | 100000 | Individual: 0.75% Company: 1.5% | Individual: 1% Company: 2% | 15% |
| 194C- Contract – Transporter not covered under 44AE | 30000 / 75000 | Individual: 0.75% Company: 1.5% | Individual: 1% Company: 2% | 15% |
| 194C- Contract – Transporter covered under 44AE & submit a declaration on prescribed form with PAN | – | – | – | 15% |
| 194D – Insurance Commission | 15000 | Individual: 3.75% Company: 3.75% | Individual: 5% Company: 5% | 15% |
| 194DA Payment in respect of life insurance policy | 100000 | Individual: 0.75% Company: 0.75% | Individual: 1% Company: 1% | 15% |
| 194E – Payment to Non-Resident Sportsmen or Sports Association | – | Individual: 15% Company: 15% | Individual: 20% Company: 20% | 15% |
| 194EE – Payments out of deposits under National Savings Scheme | 2500 | Individual: 7.5% Company: 7.5% | Individual: 10% Company: 10% | 15% |
| 194F – Repurchase Units by MFs | – | Individual: 15% Company: 15% | Individual: 20% Company: 20% | 15% |
| 194G – Commission – Lottery | 15000 | Individual: 3.75% Company: 3.75% | Individual: 5% Company: 5% | 15% |
| 194H – Commission / Brokerage | 15000 | Individual: 3.75% Company: 3.75% | Individual: 5% Company: 5% | 15% |
| 194I – Rent – Land and Building – furniture – fittings | 240000 | Individual: 7.5% Company: 7.5% | Individual: 10% Company: 10% | 15% |
| 194I – Rent – Plant / Machinery / equipment | 240,000 | Individual: 1.5% Company: 1.5% | Individual: 2% Company: 2% | 15% |
| 194IA -Transfer of certain immovable property other than agriculture land | 50,00,000 | Individual: 0.75% Company: 0.75% | Individual: 1% Company: 1% | 15% |
| 194IB – Rent – Land or building or both | 50000 per month | Individual: 3.75% | Individual: 5% | 15% |
| 194IC – Payment of Monetary consideration under Joint development agreement | – | Individual: 7.5% Company: 7.5% | Individual: 10% Company: 10% | 15% |
| 194J – Professional Fees for technical services (w.e.f. from 1.4.2020) | 30000 | Individual: 1.5% Company: 1.5% | Individual: 2% Company: 2% | 15% |
| 194J – Professional Fees in all other cases | 30000 | Individual: 7.5% Company: 7.5% | Individual: 10% Company: 10% | 15% |
| 194K- Payment of any income in respect of Units of Mutual fund as per section 10(23D) or Units of administrator or from a specified company | – | Individual: 7.5% Company: 7.5% | Individual: 10% Company: 10% | 15% |
| 194LA – TDS on compensation for compulsory acquisition of immovable Property | 250000 | Individual: 7.5% Company: 7.5% | Individual: 10% Company: 10% | 15% |
| 194 LBA (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. | Individual: 7.5% Company: 7.5% | Individual: 10% Company: 10% | 0 | |
| 194LB – Income by way of interest from infrastructure debt fund (non-resident) | – | Individual: 3.75% Company: 3.75% | Individual: 5% Company: 5% | 15% |
| 194LBB – Income in respect of investment in Securitisation trust. | – | Individual: 7.5% Company: 22.5% | Individual: 10% Company: 30% | 30% |
| 194LBC- Income in respect of investment made in a securitisation trust | – | Individual: 18.75% Company: 22.5% | Individual: 25% Company: 30% | 30% |
| 194 LC – 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 | – | Individual: 3.75% Company: 3.75% | Individual: 5% Company: 5% | 15% |
| 194LD – Interest on certain bonds and govt. Securities | – | Individual: 3.75% Company: 3.75% | Individual: 5% Company: 5% | 15% |
| 194M – Payment of 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. | 50,00,000 | Individual: 3.75% Company: 3.75% | Individual: 5% Company: 5% | 15% |
| 194N – Cash withdrawal in excess of Rs. 20 Lakh 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. | 20,00,000 | Individual: 1.5% Company: 1.5% | Individual: 2% Company: 2% | 15% |
| 194N – Cash withdrawal in excess of Rs. 1 crore 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. | 100,00,000 | Individual: 1.5% Company: 1.5% | Individual: 2% Company: 2% | 15% |
| 194O- Applicable for E-Commerce operator for sale of goods or provision of service facilitated by it through its digital or electronic facility or platform. | – | Individual: 0.75% Company: 0.75% | Individual: 1% Company: 1% | 15% |
| 195- Payment of any sum to Non resident | – | – | – | Higher of Rate in force or Double Taxation Avoidance Act rate |
| 196B – Income from units | – | Individual: 7.5% Company: 7.5% | Individual: 10% Company: 10% | 15% |
| 196C-Income from foreign currency bonds or GDR (including long-term capital gains on transfer of such bonds) (not being dividend) | – | Individual: 7.5% Company: 7.5% | Individual: 10% Company: 10% | 15% |
| 196D – Income of FIIs from securities | – | Individual: 15% Company: 15% | Individual: 20% Company: 20% | 15% |
Revised TDS rates are applicable only from 14.05.2020, and old TDS rates will be applicable till 13.05.2020 (Check old TDS rates here).
What will happen if I don’t file TDS return?