Rate of TDS u/s194A

TDS Rates • For payment to residents and domestic companies, there will be no surcharge and cess on the basic rate of TDS. This simplifies TDS rates to a great extent. • There are changes in TDS rates for payments to contractors and payment of rent. Those are explained below. TDS on payment to contractors: Section 194C

• The proposed amendment is effective from 01-10-2009.
• Rate of deduction: Rate of deduction is now based on the status of payee and not on the basis of type of payment. Earlier the rate was 2% for payment to contractors and 1% for payment to sub-contractors and advertisement contracts. Now the rate is 1% for payments made to individuals and HUF and 2% in other cases.
• Contractor manufacturing is now covered as “work” and is liable to TDS under this section.
  • This is defined as manufacturing or supplying a product according to the requirement or specification of a customer by using material purchased from such customer, but does not include manufacturing or supplying a product according to the requirement or specification of a customer by using material purchased from a person, other than such customer.
  • If the invoice mentions value of material separately then such value will be excluded for calculation of TDS, in all other cases TDS will apply to total invoice value.

• Persons carrying business of plying, hiring or leasing goods carriages.
  • Need not deduct TDS if contractor furnishes PAN.
  • Will have to furnish information as may be prescribed.

  TDS on Rent: Section 194I The proposed amendment is effective from 01-10-2009.

  Rent	Earlier	Now
  Plant and Machinery	10	2%
  Land building	15% for Individuals / HUF 10% and 20% for others	10%

  eTDS Statement Filing: Section 200 • The proposed amendment is effective from 01-10-2009. Currently section 200 specifies quarterly filing of eTDS statements. • This is changed and now CBDT can specify the periodicity for which the statements are to be filed.

   

  Processing of eTDS Statements: Section 200A The proposed amendment is effective from 01-04-2010. This new section introduces processing of eTDS Statements in the following manner.

  • Sum deductible shall be calculated after making adjustment of arithmetical errors and apparent incorrect claims.

  • Interest will be calculated.

  • From the above actual amount paid will be deducted to arrive at TDS payable or refundable.

  • Deductor will be informed about the TDS payable or refundable.

  • Time limit for the processing is within one year of the financial year of filing of eTDS statement.

  • CBDT will make a scheme of centralized processing of e-TDS Statements.

   

  Time limit for Penalty proceedings: Section 201

  • The proposed amendment is effective from 01-04-2010.
  • A person is deemed to be an assesee in default for failure to deduct TDS in whole or part. • The order for such default now will have to be passed.
  • Within two years from the end of the financial year in which the eTDS statement is filed.
  • Within four years from the end of the financial year in which payment is made or credit is given, in any other case.
  • For financial year commencing on or before 01-04-2007, this time limit is upto 31st March 2011.

  TDS Rate when PAN not available: Section 206AA

  • The proposed amendment is effective from 01-04-2010.

  • If deductee fails to furnish PAN to deductor, the deductor shall apply highest of the following rates for deducting TDS. (i) at the rate specified in the relevant provision of this Act; or (ii) at the rate or rates in force; or (iii) at the rate of 20%.

  • Form 15G/ 15H declaration for no deduction of tax will become invalid if PAN is not mentioned therein.

  • PAN will have to be mentioned in bills, vouchers and other documents communicated between deductor and deductee.

  • If deductee furnishes invalid PAN or submits PAN belonging to someone else, it will amount to non furnishing of PAN.

   

  Other Changes

  • No TDS on zero coupon bonds issued by scheduled banks: Section 194A. Effective 01-04-2009

  • No TDS for payments from New Pension Scheme: Section 197A. Effective 01-04-2009.

  • Quarterly statement for interest paid without deducting TDS is now to be submitted for “such periods as may be prescribed” : Section 206A Effective 01-10-2009.

  • Quarterly statement regarding tax collection at sources are now to be submitted for ” such periods as may be prescribed”: Section 206C Effective 01-10-2009.

  Download TDS Rate Chart For Financial year 2009-10 (A.Y. 2010-11) containing TDS rate prior budget and after budget alongwith due date chart and Income tax rate chart

  Download TDS Rate Calculator Pre Budget for the Period from 01.04.2009 to 30.09.2009

  Form 24Q:

  Male	Female	Senior Citizen	Tax (%)
  For Income Between 0 to 1,60,000	For Income Between 0 to 1,90,000	For Income Between 0 to 2,40,000	0
  For Income Between 1,60,001 to 3,00,000	For Income Between 1,90,001 to 3,00,000	For Income Between 2,40,001 to 3,00,000	10
  For Income Between 3,00,001 to 5,00,000	For Income Between 3,00,001 to 5,00,000	For Income Between 3,00,001 to 5,00,000	20
  For Income above 5,00,001	For Income above 5,00,001	For Income above 5,00,001	30
  Surcharge			0
  Education Cess			3

  Form 26Q:

  Section	Nature of Payment	Status	Tax (%)
  193	Interest on Debentures & Securities		10
  194	Deemed Dividend		10
  194A	Other Interest > Aggregate sum exceeding Rs. 10,000 for Banking Co’s , etc.per person during the financial year. > Aggregate sum exceeding Rs. 5,000 per person during the financial year		10
  194B	Lottery/Crossword Puzzle > Rs.5,000		30
  194BB	Winnings from Horse Race > Rs. 2,500		30
  194C	Contracts to Transporter, who has provided a valid PAN		0
  	Contracts to Individuals/HUF		1
  	Contracts to others		2
  194D	Insurance Commission > Rs.5,000		10
  194EE	Withdrawal from NSS > Rs.2,500		20
  194F	Repurchase of Units by MF/UTI		20
  194G	Commission on Sale of Lottery Tickets > Rs.1,000		10
  194H	Commission or Brokerage > Rs.2,500		10
  194I	Rent > Rs.1,20,000 p. a. Rent of Plant & Machinery		2
  	Rent of Land, Building, Furniture, etc		10
  194J	Professional or Technical Fess > Rs.20,000		10
  194LA	Compensation on Compulsory Acquisition of immovable property >Rs.1,00,000 during the financial year		10
  Surcharge			0
  Education Cess			0
  Note:  If there is no PAN details, then from 1st April 2010 TDS will be deduted at the rate of 20%.

  Form 27Q:

  Section	Nature of Payment	Status	Tax (%)
  194E	Payment to nonresident sportsmen or sports association		10
  195(a)	Income from foreign exchange assets payable to an Indian citizen		20
  195(b)	Income by way of long-term capital gain referred to in sec. 115E		10
  195(c)	Income by way of Short-term capital gains u/s. 111A		15
  195(d)	Income from other long-term capital gains		20
  195(e)	Income by way of interest payable by Government/Indian concern on money borrowed or debt incurred by Government or Indian concern in foreign currency		20
  195(f)	Royalty payable by Government or an Indian concern in pursuance of an agreement made by non-resident with the Government or the Indian concern after March 31, 1976, where such royalty is in consideration for the transfer of all or any rights (including the granting of a licence) in respect of copyright in any book on a subject referred to in the first proviso to section 115A(1A) to the Indian concern or in respect of computer software referred to in the second proviso to section 115(1A), to a person resident in India -
  	1.Where the agreement is made before June 1, 1997		30
  	2.Where the agreement is made after May 31, 1997 but before June 1, 2005		20
  	3.Where the agreement is made on or after June 1, 2005		10
  195(g)	Royalty (not being royalty of the nature referred to in (e) sub para) payable by Government or an Indian concern in pursuance of an agreement made by non-resident with the Government or the Indian concern and where such agreement is with an Indian concern, the agreement is approved by the Central Government or where it relates to matter included in the industrial policy, the agreement is in accordance with that policy
  	1.Where the agreement is made after March 31, 1961 but before April 1, 1976	COMPANY	50
  		OTHERS	30
  	2.Where the agreement is made after March 31, 1976 but before June 1, 1997		30
  	3.Where the agreement is made after May 31, 1997 but before June 1, 1997		20
  	4.Where the agreement is made on or after June 1, 2005		10
  195(h)	Fee for technical services payable by Government or an Indian concern in pursuance of an agreement made by non-resident with the Government or the Indian concern and where such agreement is with an Indian concern, the agreement is approved by the Central Government or where it relates to matter included in the industrial policy, the agreement is in accordance with the policy -
  	1.Where the agreement is made after February 29, 1964 but before April 1, 1976	COMPANY	50
  		OTHERS	30
  	2.Where the agreement is made after March 31, 1976 but before June 1, 1997		30
  	3.Where the agreement is made after May 31, 1997 but before June 1, 2005		20
  	4.Where the agreement is made on or after June 1, 2005		10
  195(i)	Any other income	COMPANY	40
  		OTHERS	30
  196A	Income in respect of Units of Non-residents		20
  196B	Income and Long-term Capital gain from units of an Off shore fund		10
  196C	Income and Long-term Capital Gain from Foreign Currency Bonds or shares of indian companies		10
  196D	Income of Foreign Institutional Investors for Securities		20
  Surcharge ( On Tax)	Applicable for Foreign Companies if payment/credit exceeds Rs.1 crore of such companies		2.5
  Education Cess	on Tax deducted Plus Surcharge		3

  Form 27EQ:

  Collection Code	Nature of Purchase	Tax (%)
  6CA	Alcoholic liquor for human consumption	1
  6CB	Timber obtained under a forest lease	2.5
  6CC	Timber obtained under any mode other than forest lease	2.5
  6CD	Any other forest product not being timber or tendu leave	2.5
  6CE	Scrap	1
  6CF	Parking Lot	2
  6CG	Toll plaza	2
  6CH	Mining and quarrying	2
  6CI	Tendu leaves	5
  Surcharge (On Tax)	Applicable for Foreign Companies if collections exceeds Rs.1 crore of such companies	2.5
  Education Cess	Applicable for Foreign Companies	3