Rates of TDS/TCS w.e.f. 1st April 2021

Desh Raj | Last updated: 02 April 2021

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This article outlines the updated Tax Deducted at Source (TDS) and Tax Collected at Source (TCS) rates that came into effect on 1st April 2021. It details the specific rates and threshold limits for various types of income and transactions, including interest, dividends, contractor payments, rent, royalties, and the sale of goods. The information is presented in a clear, tabular format for easy reference.

TDS/TCS Rates: April 2021 Changes Explained

1. Tentative rates of TDS

Section	Nature of Income	Rate of TDS applicable for the period		Threshold Limit for deduction tax
Section	Nature of Income	w.e.f. 01.04.2021	14-05-2020 to 31-03- 2021	Threshold Limit for deduction tax
193	Interest on Securities	10%	7.50%	-
194	Dividend	10%	7.50%	Rs. 5,000 in case of Individual
194A	Interest other than interest on Securities	10%	7.50%	Rs. 5,000 to Rs. 50,000
194C	Payment to Contractors	- 1%: If deductee is an individual orHUF - 2%: In any othercase	- 0.75%: If deductee is an individual or HUF - 1.50%: In anyother case	- Single payment : Rs.30,000 - Aggregate payment: Rs. 100,000
194D	Insurance Commission	- 10%: If deductee is domesticCompany - 5%: In any othercase	- 7.50%: If deductee is domesticCompany - 3.75%: In anyother case	15,000
194G	Commission and other payments on sale of lottery tickets	5%	3.75%	15,000
194H	Commission and Brokerage	5%	3.75%	15,000
194-I	Rent	- 10%: If rent pertains to hiring of immovable property - 2%: If rent pertains to hiring of plant and machinery	- 7.50%: If rent pertains to hiring of immovable property - 1.50%: If rent pertains to hiring of plant and machinery	2,40,000
194-IB	Payment of Rent by Certain Individuals or HUF	5%	3.75%	50,000
194J	Royalty and Fees for Professional or Technical Services	- 2%: If royalty is payable towards sale, distribution or exhibition of cinematographicfilms - 2%: If recipient is engaged in business of operation of call Centre - 2%: If sum is payable towards fees for technical services (other than professionalservices) - 10%: In all othercases	- 1.50%: If royalty is payable towards sale, distribution or exhibition of cinematographic films - 1.50%: If recipient is engaged in business of operation of call Centre - 1.50%: If sum is payable towards fees for technical services (other than professional services) - 7.50%: In all other cases	- Director's fees: Nil - Others: Rs. 30,000
194M	Payment to contractor, commission agent, broker or professional by certain Individuals or HUF	5%	3.75%	50 lakhs
194N	Cash withdrawal	- 2%: In general if cash withdrawn exceeds Rs. 1crore - 2%: If assessee has not furnished return for last 3 assessment years and cash withdrawn exceeds Rs. 20 lakhs but does not exceed Rs. 1crore - 5%: If assessee has not furnished return for last 3 assessment years and cash withdrawn exceeds Rs. 1crore	- 1.50%: In general if cash withdrawn exceeds Rs. 1 crore - 1.50%: If assessee has not furnished return for last 3 assessment years and cash withdrawn exceeds Rs. 20 lakhs but does not exceed Rs. 1crore - 3.75%: If assessee has not furnished return for last 3 assessment years and cash withdrawn exceeds Rs.1 crore	- If a person defaults in filing of return: 20 lakhs - If no default is made in filing of return: Rs 1 crore

2. Rates of TCS

Section	Goods & Services liable to TCS	Rate of TDS applicable for the period
Section	Goods & Services liable to TCS	w.e.f. 01.04.2021	14-05-2020 - 31-03- 2021
Section 206C(1)	Alcoholic liquor for human consumption	1%	0.75%
Section 206C(1)	- Timber obtained under Forestlease - Timber obtained by any mode other than undera forest lease - Any other forest produce not being timber ortendu leaves	2.50%	1.875%
Section 206C(1)	Tendu leaves	5%	3.75%
Section 206C(1)	Minerals, being coal or ignite or iron ore	1%	0.75%
Section 206C(1)	Scrap	1%	0.75%
Section 206C(1C)	Parking Lot	2%	1.50%
Section 206C(1C)	Toll Plaza	2%	1.50%
Section 206C(1C)	Mining & quarrying	2%	1.50%
Section 206C(1F)	Motor Car	1%	0.75%
Section 206C(1G)	Overseas tour travel package	5%	3.75%
Section 206C(1G)	Remittance of Forex under LRS of Rs. 7 lakh or more in a financial year	• 0.5%: Where remittance is a repayment of loan obtained for the purpose of pursuing any education • 5%: In any other case	• 0.375%: Where remittance is a repayment of loan obtained for the purpose of pursuing any education • 3.75%: In any other case
Section 206C(1H)	Sale of goods in excess of Rs. 50 lakh	0.10%	0.075%

FAQ :

The TDS rates effective from 1st April 2021 vary by the nature of income. For example, interest on securities is 7.50%, dividend is 7.50% (subject to a threshold of Rs. 5,000 for individuals), and payments to contractors are 0.75% or 1.50% depending on the deductee.

The TCS rates effective from 1st April 2021 include 0.75% on alcoholic liquor for human consumption, 1.875% on timber, 3.75% on Tendu leaves, and 0.075% on the sale of goods in excess of Rs. 50 lakh.

For TDS on rent of immovable property, the threshold limit is Rs. 2,40,000. For rent pertaining to hiring of plant and machinery, the rate is 1.50%.

Yes, for certain sections like payments to contractors (Section 194C) and insurance commission (Section 194D), the TDS rates differ. For instance, if the deductee is an individual or HUF, the rate for contractors is 0.75%, whereas for any other case, it's 1.50%.

The TCS rate for overseas tour travel packages is 3.75%.

For cash withdrawals exceeding Rs. 1 crore, the TDS rate is 1.50% in general. However, if the assessee has not furnished returns for the last 3 assessment years and the withdrawal exceeds Rs. 1 crore, the rate is 3.75%.