TDS Rates by IT Act Sections

TDS is basically a spot tax, deducted from the actual source of income. The same is described in the indirect tax section of Income tax Act 1961. It is implied on the income received from financial products like interest received on fixed deposits, incentives from the employer, commission’s payments, dividends on bonds, sale/purchase or rent of any immovable property and money earned as lottery or awards. The TDS rate applicable under different sections & subsection of is between 1%- 30%.

IT Section Threshold Limit* TDS Rate Section 192 As per applicable income slab As per income tax slab rate Section 193 ₹ 5000 for debenture payment 10% of the interests earned on security investments. Section 194 ₹ 2500 10% of proceeds from any deemed dividends Section 194A ₹ 10,000 10% of proceeds from interests earned on investments other than securities Section 194B ₹ 10,000 30% of prize money on lottery or gaming related winnings Section 194BB ₹ 10,000 30% of prize money from horse racing Section 194C ₹ 30,000 which is for each contract, whereas ₹ 100,000 is for p.a. Proceeds from any contracts / sub contracts • Individuals or HUF @ 1%

• Non Individual/corporate @ 2%

Section 194D ₹ 15,000 5% of earning as insurance commissions Section 194EE ₹ 2,500 20% of expense in NSS deposits Section 194F NIL 20% of investment in MF or UTI units Section 194G ₹ 15,000 5% of the commission money from lottery ticket selling.