TAX DEDUCTED AT SOURCE

1
 INDEX

Introduction
Payments covered
under the
scheme of TDS.
Provisions for filing
Returns to the Income Tax
Department.
Effects of Tax Evasion
 Introduction

Curb Tax Evasion

Cases included are where income can be computed at the time
of accrual
Persons responsible for making payment of income are
responsible to deduct TDS & deposit
The recipient of incomethough he gets only the net amount is
liable to include gross amount in the Income
TDS is adjusted against his final tax liability.
Covers payments such as Salary, Interest, Rent, Commission,
Brokerage, winning from lottery Puzzle, Royalty,
Technical/Professional fee etc.
Setps for TDS
 TAN

Every deductor is required to obtain a unique

identification number called TAN (Tax
Deduction Account Number) which is a ten
digit alpha numeric number. This number
has to be quoted by the deductor in every
correspondence related to TDS
Tax Deduction & Collection Account Number

Every person deducting tax or collecting tax

should obtain a tax deduction & collection
number
Such person should quote such number in
every challan for payment u/s 200 or
206C(3), in every certificate furnished u/s
203 or u/s 206C(5)
In all the TDS returns delivered
In all other documents pertaining to such
transaction as may be prescribed in the
interest of revenue.
Payment covered under the scheme of TDS.

Salary (Sec.192)
Interest on Securities (Sec.193)
Dividends (Sec.194)
Interest other than Interest on Securities (Sec.194A)
Winnings from Lotteries or crossword puzzles (Sec.194B)
Winnings from Horse Races (Sec.194BB)
Payments to Contractors and Sub-contractors (Sec.194C)
Insurance Commission (Sec.194D)
Payment to Non-resident sportsmen or sports association
(Sec.194E)
Payment in respect of NSC (Sec. 194EE)

Contd
Payment covered under the scheme of TDS.

Payments in respect of Repurchase of units of Mutual

Funds or UTI (Sec.194F)
Commission on Sale of Lottery Tickets (Sec.194G)
Commission or Brokerage (Sec.194H)
Rent (Sec.194I)
Fees for Professional or Technical Services (Sec.194J)
Payment of Compensation on acquisition of certain
immovable property (Sec.194LA)
Other Sums (Sec.195)
Long term capital gain (Sec.196B)
Income or Long term capital gain from Foreign Currency
bonds/Global Depository Receipts (Sec.196C)
Income of Foreign Institutional Investors from Securities
(Sec.196D)
Contd
 Salary (Sec.192)

Who is the payer Employer

Who is the recipient Employee

Payment Covered Taxable Salary of the employee

At what time TDS to be deducted At the time of payment

Maximum amount which can be paid The amount of exemption limit

without tax deduction (i.e.,Rs.300000/500000/250000 for F.Y.
2016-17)
Rate at which tax to be deducted. As per Rates applicable to Individual

When the provisions are not applicable --

Is it possible to get the payment without tax The employee can make application in
deduction or with lower tax deduction Form No.13 to the Assessing Officer to get
the certificate of lower tax deduction or no
tax deduction.
 Interest on Securities (Sec. 193)
Who is the payer
Who is the recipient
Payment covered
At what time TDS to be deducted.
Rate at which TDS to be deducted
When the provisions are not applicable
Is it possible to get the payment without tax
deduction or with lower tax deduction
Payer of interest on securities
A resident person holding securities
Interest on securities
At the time of payment or at the time of
credit, whichever is earlier
10%
Central/State Government securities
Debentures issued by co-operative society
Listed Demat securities
Securities owned by LIC
The recipient can make application to the
Assessing Officer in Form No. 13 or
declaration to the payer in Form 15G or
15H as applicable
 Dividends (Sec. 194)

Who is the payer Domestic company

Who is the recipient Resident shareholder

Payment Covered Deemed dividend under section 2(22)(e)

At what time TDS to be deducted At the time of payment

Rate at which TDS to be deducted 10%

When the provisions are not applicable Dividend covered by section 115-O

Is it possible to get the payment without tax The recipient can make application to the
deduction or with lower tax deduction Assessing Officer in Form No. 13 or
declaration to the payer in Form 15G or
15H as applicable
 INTEREST OTHER THAN INTEREST ON
SECURITIES (Sec 194A)
Who is the payer
Who is the recipient
Payment covered
At what time TDS to be deducted.
Maximum amount which can be paid without
tax deduction
Rate at which TDS to be deducted
When the provisions are not applicable
Is it possible to get the payment without tax
deduction or with lower tax deduction
Any person paying interest other than interest
on securities
A Resident person
Interest other than interest on securities
At the time of payment or at the time of credit,
whichever is earlier
Rs 10000/- in case of Bank Interest otherwise
Rs 5000/-
10%
If the payee is Insurance company or
financial institution including co-operative
societies etc.
Declaration to the payer in Form 15G or 15H
as applicable
 Winnings from Lotteries or Crossword Puzzles
(Sec. 194B)

Who is the payer Any person paying winnings from

lotteries/crossword puzzles/card games/other
games
Who is the recipient Any Person
Payment covered Winnings from lotteries/crossword
puzzles/card games/other games
At what time TDS to be deducted. At the time of Payment
Maximum amount which can be paid without If the amount payment is Rs. 10000/- or less
tax deduction than Rs. 10000/-
Rate at which TDS to be deducted 30%

When the provisions are not applicable --

Is it possible to get the payment without tax Not Possible
deduction or with lower tax deduction
 Winnings From Horse Races (Sec. 194BB)

Who is the payer Any person paying winnings from horse

races
Who is the recipient Any person

Payment covered Winnings from Horse Races

At what time TDS to be deducted. At the time of payment

Maximum amount which can be paid If the amount of payment is Rs. 10000/- or
without tax deduction less than Rs. 10000/-
Rate at which TDS to be deducted 30%

When the provisions are not applicable --

Is it possible to get the payment without tax Not Possible

deduction or with lower tax deduction
 Payments to Contractors And Sub-contractors (Sec.194C)
Who is the payer
Who is the recipient
Rate of TDS
Payment Covered
At what time TDS has to be
deducted
Maximum amount which can
be paid without tax deduction
Is it possible to get the
payment without tax
deduction or with lower tax
deduction
Specified person
A resident person
1% Individual & HUF
2% Any other person
Consideration for any Work Contract
At the time of payment or at the time of credit
The tax is required to be deducted if a single payment exceeds
Rs. 30000/- or if the aggregate payments exceed Rs. 100000/-
per annum
The recipient can make application to the Assessing Officer in
Form No. 13
 Insurance Commission (Sec.194D)
Who is the payer
Who is the recipient
Payment covered
At what time TDS to be deducted.
Maximum amount which can be paid without
tax deduction
Rate at which TDS to be deducted
When the provisions are not applicable
Is it possible to get the payment without tax
deduction or with lower tax deduction
Any person paying insurance commission.
A resident person
Insurance Commission
At the time of payment or at the time of credit
whichever is earlier
If the amount of payment is Rs. 15000/- or
less
5% if the recipient is resident non-corporate
assessee and
10% if the recipient is resident corporate
assessee
--
The recipient can make an application in
Form No. 13 to the Assessing Officer to get
the certificate of lower tax deduction or no tax
deduction.
 Payment of Life insurance policy (Sec.194DA)

Who is the payer Any person responsible for paying to a resident

any sum under a Life Insurance Policy
( Including bonus)
Who is the recipient A resident person

Payment covered Any payment pertaining to life Insurance policy

whether at the time of maturity or otherwise
At what time TDS to be deducted. At the time of payment

Maximum amount which can be paid without Amount less than Rs.1,00,000 in a FY
tax deduction
Rate at which TDS to be deducted 1%

When the provisions are not applicable If the payment is exempt in the hands of
recipient under section 10(10D)
Is it possible to get the payment without tax Declaration to the payer in Form 15G or 15H
deduction or with lower tax deduction as applicable
 Payment to Non-resident sportsmen or sports
association (Sec.194E)

Who is the payer Any person making payment to non-resident

sportsman/sports association
Who is the recipient Non-resident sportsman/sports association

Payment covered Payment to non-resident sportsman/sports

association
At what time TDS to be deducted. At the time of payment or at the time of credit
whichever is earlier
Maximum amount which can be paid without Nil
tax deduction
Rate at which TDS to be deducted 20%

When the provisions are not applicable --

Is it possible to get the payment without tax No Provision
deduction or with lower tax deduction
 Payments in respect of NSS(Sec.194EE)

Who is the payer Post Office

Who is the recipient Any Person

Payment covered Payment (Principal+Interest) out of National

Saving Scheme, 1987.

At what time TDS to be deducted. At the time of payment

Maximum amount which can be paid without If the amount of payment is Rs.2500 or less
tax deduction than Rs.2500

Rate at which TDS to be deducted 10%

When the provisions are not applicable The payment is made to legal heirs of the
deceased depositor
 Payments on account of repurchase of units of Mutual
Funds or UTI (Sec. 194F)

Who is the payer Mutual Fund or UTI

Who is the recipient
Payment covered
At what time TDS to be deducted.
Maximum amount which can be paid without
tax deduction
Rate at which TDS to be deducted
Unit holder under section 80CCB
Payment on account of repurchase of units
referred to in section 80CCB
At the time of payment
--
20%

When the provisions are not applicable --

Is it possible to get the payment without tax No Provision
deduction or with lower tax deduction
 Commission on Sale of Lottery Tickets (Sec.194G)

Who is the payer Any person paying commission of sale of

lottery tickets
Who is the recipient Any person

Payment covered Commission on sale of lottery tickets

At what time TDS to be deducted. At the time of payment or at the time of credit,
whichever is earlier
Maximum amount which can be paid without If the amount of payment is Rs. 15000 or less
tax deduction than Rs. 15000
Rate at which TDS to be deducted 5%

When the provisions are not applicable --

Is it possible to get the payment without tax The recipient can make an application in
deduction or with lower tax deduction Form No. 13 to the Assessing Officer to get a
certificate of lower tax deduction or no tax
deduction
 Commission or Brokerage (Sec.194H)
Who is the payer
Who is the recipient
Payment covered
At what time TDS to be deducted.
Maximum amount which can be paid
without tax deduction
Rate at which TDS to be deducted
When the provisions are not applicable
Is it possible to get the payment without tax
deduction or with lower tax deduction
Any person paying commission or
brokerage
Any resident person
Commission or brokerage (not being
insurance commission)
At the time of payment or at the time of
credit, whichever is earlier
If the amount of payment is Rs. 15000 or
less
5%
--
The recipient can make an application in
Form No.13 to the Assessing Officer to get
a certificate of lower tax deduction or no tax
deduction
 Rent (Sec.194-I)

Who is the payer Any person paying rent (not being an individual
or HUF whose books of account are not
required to be audited under section 44AB in the
immediately preceding financial year)
Who is the recipient A Resident Person
Payment covered Rent
At what time TDS to be deducted. At the time of payment or at the time of credit,
whichever is earlier
Maximum amount which can be paid Rs. 180000/- or less
without tax deduction
Rate at which TDS to be deducted For Plant and Machinery Rent 2% and for
For Use of and Land or Building or furniture ot
fitting 10%

Is it possible to get the payment without The recipient can make application in Form No.
tax deduction or with lower tax 13
deduction
 Purchase of Immovable Property (Sec.194-IA)

Who is the payer Any person

Who is the recipient A Resident Person

Payment covered Rent
At what time TDS to be deducted. At the time of payment or at the time of credit,
whichever is earlier
Maximum amount which can be paid Rs. 50,00,000/- or less
without tax deduction
Rate at which TDS to be deducted 1%
20% if no PAN

Provisions of TAN Not applicable

 Fees for Professional or Technical Services
(Sec.194J)
Who is the payer
Who is the recipient
Payment covered
At what time TDS to be deducted.
Maximum amount which can be paid
without tax deduction
Rate at which TDS to be deducted
Is it possible to get the payment without
tax deduction or with lower tax deduction
Any person (not being an individual or HUF not
subject to Audit u/s 44AB) who pays/credit fees
for professional/Technical service/Royalty or
Directors fees
A Resident person
Professional services, technical services,
Royalty
At the time of payment or at the time of credit,
whichever is earlier
If the amount of payment during the financial
year is Rs. 30,000/- or less
10%
The recipient can make application in Form No.
13
 Compensation On Certain Immovable Property
(Sec.194LA)
Who is the payer
Who is the recipient
Payment covered
At what time TDS to be deducted.
Maximum amount which can be paid
without tax deduction
Rate at which TDS to be deducted
Is it possible to get the payment without
tax deduction or with lower tax deduction
Any person paying compensation on account of
compulsory acquisition of land ( not being rural
agricultural land)
A Resident person
compensation/enhanced compensation on
account of compulsory acquisition of land.
At the time of payment or at the time of credit,
whichever is earlier
If the amount of payment/credit during the
financial year is Rs2,50,000 or less.
10%
The recipient can make application in Form No.
13
 Interest Payable on Infrastructure Debt
Fund(Sec.194LB)

Who is the payer Any person responsible for paying interest on

infrastructure debt fund referred to in section
10(47).

Who is the recipient A non resident or a foreign company

Payment covered interest on infrastructure debt fund

At what time TDS to be deducted. At the time of payment or at the time of credit,
whichever is earlier
Maximum amount which can be paid No threshold limit.
without tax deduction

Rate at which TDS to be deducted 5%( +SC+EC+SHEC)

Is it possible to get the payment without Section 197 is not applicable.

tax deduction or with lower tax deduction
 Provisions for Filing Returns

Different Payments In case the person deducting tax is a In case the person Due date for submission
company or a Government deducting tax is of return by the person
department or a person whose books any other person deducting tax
are required to be audited u/s. 44AB
in the immediately preceding year or
in whose case number of deductees
in any of the quarterly statements in
the immediately year is 20 or more

Salary Form No. 24Q in Electronic format Form No. 24Q July 31 for Q1
and Form No. 27A October 31 for Q2
January 31 for Q3
May 31 for Q4
Payment (other Form No. 26Q in Electronic format Form No. 26Q July 31 for Q1
than salary) to a and Form No. 27A October 31 for Q2
resident January 31 for Q3
May 31 for Q4
Payment (other Form No. 27Q in Electronic format Form No. 27Q July 31 for Q1
than salary) to a and Form No. 27A (quarterly) (quarterly) October 31 for Q2
non-resident January 31 for Q3
May 31 for Q4
 Issue TDS Certificates Sec. 203

Sr. Form no Periodicity Cut off Date

No.
1 16 For Annual 31st May of following financial
Salary year

2 16A Other Quarterly Within 15 days from due date

than of furnishing the TDS
salary statement
 Dates for Payment of TDS

Deductor For MARCH For April to February

Government On or before 7th On the same day for other than

of next month for salary & on or before 7th of
salary next month for salary
Other than On or before 30th On or before 7th of next month
Government April

Special 30th April Quarterly payment on or

Cases before 7th of the month
succeeding quarter
 Furnishing of quarterly returns for payment of
interest to residents without Deducting Tax (Sec.
206A)

Banking company, Cooperative societies, & Public

Companies shall furnish quarterly return to
department in respect of payments of Interest
(other than Interest on Securities) in any
computer readable media.
 Collection of Tax
Who is the payer Seller

Who is the recipient Buyer

Payment covered As per Details in next slide

At what time TDS to be Collected. At the time of receipt or at the time of

debiting the account, whichever is earlier
Maximum amount which can be paid Nil
without tax collection
Rate at which TDS to be deducted As per Details in next slide

Is it possible to get the payment without tax The recipient can make an application in
deduction or with lower tax deduction Form No. 13 to the Assessing Officer to get
a certificate of lower tax deduction or no tax
deduction
Rates for Collection of TAX
 Effects of Evasion of TDS (Sec 201)

Sr. Reasons Effects

No.
1. Non deduction The expenditure for which TDS to be
of TDS deducted gets DISALLOWED & penal interest
@1% for every month or part of month from
the date on which such tax was deductible to
the date of deduction
2. Non payment of The expenditure for which TDS deducted but
TDS not paid gets disallowed

3. Less deduction The amount less deducted is required to be

of TDS. paid by the deduct or along with penalty
4. Late Payment of The deductor should have to pay penal interest
TDS @1.5% for every month or part of month
from date of deduction to the date of
Penal Provisions
Questions?
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Thank You!

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