CA Aman Rajput
Quick Summary
Introduction Whenever a new TDS section comes, we the professionals and students might feel that government is making this TDS as a subject for them, and it's not just sections of income tax act, today in this article I will discuss new section of TDS, keeping my own thoughts and opinion. In the
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FAQ :
Section 194T is a new TDS provision introduced in the Union Budget 2024 that requires tax to be deducted at source on certain payments made to partners of a firm, including salary, bonus, commission, interest, or remuneration.
The TDS rate is 10%, and it applies when the aggregate amount paid to a partner in a financial year exceeds £20,000.
Section 194T comes into effect from 1st April 2025.
The limit is calculated on an aggregate basis. TDS is applicable if a single payment exceeds £20,000 or if the total of multiple payments throughout the financial year exceeds £20,000.
Section 192 deals with TDS on salaries for employees. Payments to partners of a firm were not covered under Section 192, but Section 194T now brings these payments under TDS provisions.
Firms need to obtain a TAN if they don't have one, deduct TDS at 10% on applicable payments, deposit the deducted TDS on time, file TDS returns quarterly, and issue TDS certificates (Form 16A) to partners.
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