Published Jan 3, 2025 4 Min Read

Link copied
Open FD Open FD

Tax Deducted at Source (TDS) is a mechanism employed by the Indian government to collect income tax directly at the source of income. This ensures timely tax collection and reduces the burden of tax compliance. The TDS rates vary depending on the nature of income, the payee's status, and other factors.

Key components of a TDS rate chart

  • TDS Section: Specifies the type of income on which TDS is applicable (e.g., salary, rent, professional fees).  
  • Nature of Payment: Describes the specific type of payment (e.g., salary, commission, contract payment).
  • Applicable Rate: Indicates the percentage of TDS to be deducted from the payment.
  • Threshold Limit: Specifies the minimum amount of payment after which TDS becomes applicable.

TDS Rates in India

All persons in India who earn an income are obliged to deduct the tax at the source that applies to their income and then deposit the required TDS amount within the specified time and due date to the respective authority.


The tables below outline the different TDS rate charts for payments made to both resident and non-resident individuals, as well as domestic and international companies operating in India.

Also read: What is TDS

TDS rate charts for the FY 2023-24 and FY 2024-25

 

Section

Deductee

Nature of transaction

Threshold limit (Rs.)

TDS rate

192

R, NR

Salary Payment

Basic Exemption Limit

Normal Slab Rates

192A

R, NR

Premature EPF Withdrawal

50,000

10% (20% if no PAN)

193

R

Interest on Securities

Debentures: 5,000, Savings Bonds: 10,000, Others: No Limit

10%

194

R

Dividend Payment

5,000

10%

194A

R

Interest Income (Except Securities)

Senior Citizens: 50,000, Others: 40,000

10%

194A

R

Interest Income (Other Sources)

5,000

10%

194B

R, NR, FC

Winnings from Games, Lotteries

10,000

30%

194BA

R, NR, FC

Online Game Winnings

Nil

30%

194BB

R, NR, FC

Horse Race Winnings

10,000

30%

194C

R

Payments to Contractors/Subcontractors

Single Transaction: 30,000, Aggregate: 100,000

Individuals/HUF: 1% Others: 2%

194D

R

Insurance Commission

Domestic Companies: 15,000, Others: 15,000

Domestic Companies: 10% Others: 5%

194DA

R

Life Insurance Payouts

100,000

5%

194E

NR, FC

Payments to Non-Resident Sportspersons

No Limit

20% + Surcharge + Cess

194EE

R, NR

National Savings Scheme (NSS) Payments

2,500

10%

194F

R, NR

Mutual Fund Unit Repurchase

No Limit

20%

194G

R, NR, FC

Lottery Ticket Commission

15,000

5%

194H

R

Commission or Brokerage

15,000

5%

194-I(a)

R

Rent on Plant & Machinery

240,000

2%

194-I(b)

R

Rent on Land/Building/Furniture/Fittings

240,000

10%

194-IA

R

Transfer of Immovable Property

5,000,000

1%

194-IB

R

Rent Payment (Not Covered by 194-I)

50,000 per month

5%

194-IC

R

Joint Development Agreement Payments

No Limit

10%

194J

R

Professional Fees, Director Remuneration, etc.

30,000

10% (except technical services: 2%)

194K

R

Mutual Fund Unit Income

No Limit

10%

194LA

R

Compensation on Immovable Property Acquisition

250,000

10%

194LB

NR, FC

Interest on Infrastructure Debt Fund

No Limit

5% + Surcharge + Cess

194LC

NR, FC

Interest on Foreign Currency Loan

No Limit

5% (4% for IFSC-listed bonds)

194LD

NR, FC

Interest on Rupee-Denominated Bonds

No Limit

5%

194LBA(1)

R

Business Trust Income Distribution

No Limit

10%

194LBA(2)

NR, FC

Business Trust Interest/Dividend Income

No Limit

5%/10%

194LBA(3)

NR, FC

Business Trust Rental Income

No Limit

30%/40%

194LBB

R, NR, FC

Investment Fund Income

No Limit

10%/30%/40%

194LBC

R, NR, FC

Securitisation Fund Income

No Limit

25%/30%/40%

194M

R

Certain Payments (Not Covered by 194C, 194H, 194J)

5,000,000

5%

194N

R, NR

Cash Withdrawal

Co-operative Societies: 3 Crore, Others: 1 Crore

2%/5% (based on ITR filing)

194O

R

E-commerce Transactions

500,000

1%/5% (no PAN)

194P

R

Payments to Senior Citizens (75+)

Basic Exemption Limit

Normal Slab Rates

194Q

R

Purchase of Goods

5,000,000

0.10%

194R

R

Business/Profession Perquisites

20,000

10%

194S

R

Virtual Digital Asset Transfer

Specified Persons: 50,000, Others: 10,000

1%

195

NR

Income on Investments

No limit

20%

195

NR

Long-Term Capital Gains (LTCG) under Section 115E

No limit

10%

195

NR, FC

LTCG under Section 112(1)(c)(iii)

No limit

10%

195

NR, FC

LTCG under Section 112A

No limit

10%

195

NR, FC

Short-Term Capital Gains (STCG) under Section 111A

No limit

15%

195

NR, FC

Other LTCG

No limit

20%

195

NR, FC

Interest on Foreign Currency Loans

No limit

20%

195

NR, FC

Royalty Income (Copyright, Software)

No limit

20%

195

NR

Royalty Income (Industrial Policy Agreements)

No limit

20%

195

FC

Royalty Income (Industrial Policy Agreements)

No limit

20% or 50% (based on agreement date)

195

NR

Technical Fees (Industrial Policy Agreements)

No limit

20%

195

FC

Technical Fees (Industrial Policy Agreements)

No limit

20% or 50% (based on agreement date)

195

NR

Other Income

No limit

30%

195

FC

Other Income

No limit

40%

196B

NR, FC

Income from Offshore Funds

No limit

10%

196C

NR, FC

Income from Foreign Currency Bonds/GDRs

No limit

10%

196D

NR, FC

Income (excluding dividends and capital gains) from FIIs

No limit

20%

206AB

R

Payments to Non-Filers

No limit

2x Applicable Rate or 5%

206AA

R, NR, FC

TDS for No PAN

No limit

Higher of Applicable Rate or 20%

 

Notes:

This table is for reference only. Please consult tax professionals for accurate and up-to-date information.

 

  • R = Resident, NR = Non-Resident, FC = Foreign Company
  • The standard tax rates for individuals and HUFs under the new tax regime have been revised starting from FY 2023-24.
  • Additionally, the applicable surcharge and health and education cess will be levied on top of the TDS rates for NRI and FC deductees.
  • In the above TDS rate chart, the term 'Resident' payee encompasses domestic companies.
  • All TDS changes introduced in the Budget 2023 have been incorporated into the TDS chart provided above.


Budget 2024 key updates

TDS Sections

Current TDS Rate

Proposed TDS Rate

Effective from

Section 194D - Payment of insurance commission (non-company)

5.00%

2.00%

1 April 2025

Section 194DA - Payment in respect of life insurance policy

5.00%

2.00%

1 October 2024

Section 194G - Commission on sale of lottery tickets

5.00%

2.00%

1 October 2024

Section 194H - Commission or brokerage payment

5.00%

2.00%

1 October 2024

Section 194-IB - Rent payment by certain individuals or HUF

5.00%

2.00%

1 October 2024

Section 194M - Payment of certain sums by certain individuals or HUFs

5.00%

2.00%

1 October 2024

Section 194-O - Payment to e-commerce participants by e-commerce operator

1.00%

0.1%

1 October 2024

Section 194F - Payment by mutual funds or UTI on account of repurchase of units

Proposed to be removed

  

1 October 2024

 

These updates reflect significant reductions in TDS rates and a notable removal of TDS for specific sections, which will be effective mostly from October 2024.

 

TDS Rates chart for Indian Residents

Nature of Payment

% of TDS

Payment of salary (Section 192)

As per normal income tax slab rate

Payment of EPF Scheme dues, taxable in employee's hand (Section 192A)

10%

Interest on securities (Section 193)

10%

Dividend (excluding dividends under section 115-O) (Section 194)

10%

Interest income other than on securities (Section 194A)

10%

Winnings from lotteries, crosswords, games, etc. (Section 194B / 194BB)

30%

Payment to contractors/sub-contractors (Section 194C)

2% (non-HUFs/individuals), 1% (HUFs/individuals)

Insurance commission (Section 194D)

5%

Payment for Life insurance policy (Section 194DA)

1%

Rent on plant and machinery (Section 194-I)

2%

Rent on land, furniture, and fittings (Section 194-I)

10%

Payment on transfer of non-agricultural immovable property (Section 194-IA)

1%


This table provides a streamlined view of the TDS rates for various categories of payments to resident Indians, with specific sections of the Income Tax Act noted for clarity.

Reduction in TDS rates due to COVID-19

The Indian government, during the period of COVID-19, provided some relief to the Indian taxpayers in the TDS rates between the period of 14/5/2020 to 31/3/2021 because of the lockdown due to the pandemic that had a great impact on all sectors of the economy.

However, this reduction is available to TDS rates only and is not applicable to any other tax rates that are charged and deducted at higher rates. Also, the advantages of this reduction were made available for Indian residents only and could not be claimed by non-residents.

Conclusion

Understanding the TDS rate chart is crucial for both individuals and businesses to ensure tax compliance. By familiarising yourself with the applicable TDS rates, you can accurately calculate tax liabilities, avoid penalties, and streamline the tax filing process. It is essential to stay updated with the latest TDS regulations as they may change from time to time. For precise and personalised guidance, consider consulting with a tax professional.

Investment Calculator

Systematic Investment Plan Calculator image

Systematic Investment Plan Calculator
Systematic Deposit Calculator image

Systematic Deposit Calculator
Gratuity Calculator image

Gratuity Calculator
MF Calculator image

MF Calculator
Lumpsum Calculator image

Lumpsum Calculator
Employee Provident Fund Calculator image

Employee Provident Fund Calculator
Sukanya Samriddhi Yojana Calculator image

Sukanya Samriddhi Yojana Calculator
PPF Calculator image

PPF Calculator
Recurring Deposit Calculator image

Recurring Deposit Calculator

Related articles

Article 1

Tax Evasion

Jul 16, 2024

Article 2

Tax Avoidance

Jul 16, 2024

Article 3

TDS on FD Interest

Dec 13, 2024

Read More

Related videos

Systematic Deposit Plan vs Recurring Deposit
 
 

Systematic Deposit Plan vs Recurring Deposit

Systematic Deposit Plan - Features and Benefits
 
 

Systematic Deposit Plan - Features and Benefits

Retirement Plan
 
 

Retirement Plan

Fixed Deposits and Recurring Deposits
 
 

Fixed Deposits and Recurring Deposits

You are here

Related links

 Bajaj Finserv App for All Your Financial Needs and Goals

Trusted by 50 million+ customers in India, Bajaj Finserv App is a one-stop solution for all your financial needs and goals.

You can use the Bajaj Finserv App to:

  • Apply for loans online, such as Instant Personal Loan, Home Loan, Business Loan, Gold Loan, and more.
  • Explore and apply for co-branded credit cards online.
  • Invest in fixed deposits and mutual funds on the app.
  • Choose from multiple insurance for your health, motor and even pocket insurance, from various insurance providers.
  • Pay and manage your bills and recharges using the BBPS platform. Use Bajaj Pay and Bajaj Wallet for quick and simple money transfers and transactions.
  • Apply for Insta EMI Card and get a pre-approved limit on the app. Explore over 1 million products on the app that can be purchased from a partner store on Easy EMIs.
  • Shop from over 100+ brand partners that offer a diverse range of products and services.
  • Use specialised tools like EMI calculators, SIP Calculators.
  • Check your credit score, download loan statements and even get quick customer support—all on the app.

Download the Bajaj Finserv App today and experience the convenience of managing your finances on one app.

Download app image

Disclaimer

As regards deposit taking activity of Bajaj Finance Ltd (BFL), the viewers may refer to the advertisement in the Indian Express (Mumbai Edition) and Loksatta (Pune Edition) furnished in the application form for soliciting public deposits or refer https://www.bajajfinserv.in/fixed-deposit-archives 
The company is having a valid Certificate of Registration dated March 5, 1998 issued by the Reserve Bank of India under section 45 IA of the Reserve Bank of India Act, 1934. However, the RBI does not accept any responsibility or guarantee about the present position as to the financial soundness of the company or for the correctness of any of the statements or representations made or opinions expressed by the company and for repayment of deposits/discharge of the liabilities by the company. 

For the FD calculator the actual returns may vary slightly if the Fixed Deposit tenure includes a leap year.