Quick Summary
Reduction in rate of Tax Deduction at Source (TDS) Tax Collection at Source (TCS) In order to provide more funds at the disposal of the taxpayers for dealing with the economic situation arising out of COVID-19 pandemic, the rates of Tax Deduction at Source (TDS) for the following non-salaried specified payments made to residents has been reduced by 25% for the period from 14th May, 2020 to 31stMarch, 2021:- TDS Rate Chart for FY 2020-21 Pre Post 14th May 2020 S.
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FAQ :
The rates of Tax Deduction at Source (TDS) and Tax Collection at Source (TCS) have been reduced by 25%.
The reduced rates are effective from 14th May 2020 and will remain in place until 31st March 2021.
The reduction is intended to provide taxpayers with more funds to manage the economic challenges arising from the COVID-19 pandemic.
No, the reduction applies to specified non-salaried payments and receipts. The reduced rates do not apply if tax is required to be deducted or collected at a higher rate due to non-furnishing of PAN/Aadhaar.
Yes, for instance, the TDS rate for Interest on Securities (Section 193) has been reduced from 10% to 7.5%, and for Rent for plant and machinery (Section 194-I(a)) from 2% to 1.5%.
Yes, for example, the TCS rate for the sale of Tendu Leaves (Section 206C(1)) has been reduced from 5% to 3.75%, and for the sale of scrap from 1% to 0.75%.
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