With effect from Finance Act 2019, section 194N has come into existence, which has imposed TDS liability on Payer when any cash payment exceeding Rs. 1 crore is made (individually or in aggregate) during the financial year to Payee.
Rate of TDS
2%
Payer
- Banking company
- Co-operative society carrying business of banking
- Post office
Payee/Recipient
Any person except following
- Government;
- Banking company or co-operative society engaged in carrying on the business of banking or a post office;
- Business correspondent of a banking company or co-operative society.
- Any white label automated teller machine operator of a banking company or co-operative society.
Special Points
- Suppose a customer is having multiple accounts with his banks then TDS provision would be applied considering provision of all such accounts in aggregate.
Finance act 2020 has brought following changes to above event of TDS provision
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