Tax Deducted at Source (TDS) is a mechanism by which the government collects tax at the source of income. The payer deducts a certain percentage of the payment as tax and remits it to the government on behalf of the payee. The TDS rates and applicable sections under the Income Tax Act for the Financial Year (FY) 2024-25 (Assessment Year 2025-26) are outlined below:
TDS Rate Chart for FY 2024-25 (AY 2025-26):
| Section | Nature of Payment | Threshold Limit (₹) | TDS Rate (%) | Effective Date |
|---|---|---|---|---|
| 192 | Salary | As per income tax slab rates | As per slab rates | – |
| 192A | Premature withdrawal from EPF | ₹50,000 | 10% | – |
| 193 | Interest on securities | ₹10,000 | 10% | – |
| 194 | Dividend | ₹5,000 | 10% | – |
| 194A | Interest other than on securities | ₹40,000 (₹50,000 for senior citizens) | 10% | – |
| 194B | Winnings from lotteries, crossword puzzles, etc. | ₹10,000 | 30% | – |
| 194BA | Winnings from online games | No threshold | 30% | – |
| 194BB | Winnings from horse races | ₹10,000 | 30% | – |
| 194C | Payment to contractors/sub-contractors (single transaction) | ₹30,000 | 1% (Individual/HUF), 2% (Others) | – |
| 194C | Payment to contractors/sub-contractors (aggregate in FY) | ₹1,00,000 | 1% (Individual/HUF), 2% (Others) | – |
| 194D | Insurance commission | ₹15,000 | 5% | – |
| 194DA | Payment in respect of life insurance policy | ₹1,00,000 | 5% | – |
| 194EE | Payments from National Savings Scheme | ₹2,500 | 10% | – |
| 194F | Payments on account of repurchase of units by Mutual Fund or Unit Trust of India | No threshold | 20% | Up to 30-09-2024 |
| 194F | Omitted | – | – | From 01-10-2024 |
| 194G | Commission on sale of lottery tickets | ₹15,000 | 5% | – |
| 194H | Commission or brokerage | ₹15,000 | 5% | Up to 30-09-2024 |
| 194H | Commission or brokerage | ₹15,000 | 2% | From 01-10-2024 |
| 194I(a) | Rent for plant and machinery | ₹2,40,000 | 2% | – |
| 194I(b) | Rent for land, building, furniture, etc. | ₹2,40,000 | 10% | Up to 30-09-2024 |
| 194I(b) | Rent for land, building, furniture, etc. | ₹2,40,000 | 2% | From 01-10-2024 |
| 194IA | Payment on transfer of certain immovable property other than agricultural land | ₹50,00,000 | 1% | – |
| 194IB | Payment of rent by certain individuals or HUF | ₹50,000 per month | 5% | Up to 30-09-2024 |
| 194IB | Payment of rent by certain individuals or HUF | ₹50,000 per month | 2% | From 01-10-2024 |
| 194IC | Payment under specified agreement | No threshold | 10% | – |
| 194M | Payment of certain sums by certain individuals or HUF | ₹50,00,000 | 5% | Up to 30-09-2024 |
| 194M | Payment of certain sums by certain individuals or HUF | ₹50,00,000 | 2% | From 01-10-2024 |
| 194O | Payment of certain sums by e-commerce operator to e-commerce participant | ₹5,00,000 | 1% | Up to 30-09-2024 |
| 194O | Payment of certain sums by e-commerce operator to e-commerce participant | ₹5,00,000 | 0.1% | From 01-10-2024 |
Key Changes Effective from 1st October 2024:
- Section 194H (Commission or Brokerage): TDS rate reduced from 5% to 2%.
- Section 194IB (Rent by Individuals or HUF): TDS rate reduced from 5% to 2%.
- Section 194M (Payments by Individuals or HUF): TDS rate reduced from 5% to 2%.
- Section 194O (E-commerce Transactions): TDS rate reduced from 1% to 0.1%.
- Section 194F (Repurchase of Units by Mutual Funds or UTI): This section has been omitted.
These changes aim to simplify tax compliance and reduce the burden on taxpayers. It’s essential to stay updated with these modifications to ensure accurate TDS deductions and adherence to tax regulations.
if you further need to study the detail about TDS deposit dates and tds return filing process, the same can be read at TDS Deposit dates and Return Filing
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