CA.R.S.KALRA
Quick Summary
[Applicable from September 1, 2019] 194N. Every person, being,- a banking company to which the Banking Regulation Act, 1949 (10 of 1949) applies (including any bank or banking institution referred to in section 51 of that Act); a co-operative society engaged in carrying on the business of
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FAQ :
Banking companies, co-operative societies engaged in banking, and post offices are responsible for deducting TDS on cash withdrawals.
For individuals who have filed income tax returns for the preceding three years, the TDS rate is 2% on cash withdrawals exceeding ₹1 crore. For those who haven't filed returns, it's 2% on withdrawals between ₹20 lakh and ₹1 crore, and 5% on withdrawals exceeding ₹1 crore.
The threshold limit is ₹1 crore for recipients who have filed their income tax returns for all three preceding assessment years. For recipients who have not filed returns for any of these years, the limit is ₹20 lakh.
Yes, TDS is not applicable to payments made to the Government, banking companies, co-operative societies engaged in banking, post offices, business correspondents, and certain other notified entities.
Yes, Section 194N applies to cash withdrawals made by both resident and non-resident individuals.
In the case of joint accounts, the cash withdrawal limit is considered for each individual responsible for operating the account, and aggregate withdrawals from all accounts maintained by the recipient with the bank are considered.
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