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In a move that brings relief to individual investors, the Central Board of Direct Taxes (CBDT) has notified that no Tax Deducted at Source (TDS) shall be applicable on certain withdrawals from the National Savings Scheme (NSS). The exemption was notified via Notification No. 27/2025, dated April 4, 2025. The notification, issued under sub-section (1F) of Section 197A of the Income-tax Act, 1961, specifies that no tax shall be deducted at source under Section 194EE on payments made to an indiv
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FAQ :
The CBDT has notified that Tax Deducted at Source (TDS) will not be applicable on certain withdrawals from the National Savings Scheme (NSS).
The exemption is notified under sub-section (1F) of Section 197A of the Income-tax Act, 1961, and relates to Section 194EE.
Individual assessees withdrawing amounts referred to in clause (a) of sub-section (2) of Section 80CCA will benefit from this exemption.
No, it applies to specific withdrawals covered under clause (a) of Section 80CCA(2), effectively meaning accumulated balances from accounts like the NSS-87 Account.
The exemption is effective immediately upon its publication in the Official Gazette.
Previously, Section 194EE mandated a 10% TDS on premature withdrawals from NSS accounts if the amount exceeded Rs. 2,500, unless an exemption applied.
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