Presentation on

TDS
Provision
By Nilesh Deharkar
&
AMAN Bhattacharya
TDS PROVISION
a) Section 192 salary

b) Section 193 Intrest On Securities

c) Section 194 Dividends

d) Section 194A Intrest Other Than “Intrest On Securities”

e) Section 194B Winning From Lottery Or Crossword Puzzles

f) Section 194BB Winning From Horse Races.

g) Section 194C Payment To Contractor

h) Section 194D – Insurance Commission

i) Section 194E – Payment to Resident Sportsman/Sports Association

(j) Section 194EE – Payment in respect of deposits under National Saving
Scheme

(k) Section 194F – Payment on account of Repurchase of Units by Mutual

Funds or UTI

(l) Section 194G – Commission etc. on the sale of Lottery Tickets

(m) Section 194H – Commission or Brokerage

(n) Section 194 I – Rent

(o) Section 194 J – Fees for Professional or Technical Services

(p) Section 197 – Obtaining a Certificate of Lower Rate from the Assessing
Officer
Section 192 - Salary

(a) Any person responsible for paying SALARIES is required to deduct tax at
source on the amount payable to employees. Tax is required to be
deducted at the time of actual payment of salary.

(b) Where an employee is in employment of more than one employer, tax will
be deducted at source by the employer, which the employee chooses or the
present employer.

(c) The employee may furnish to the employer details of income chargeable to
tax under other heads of income. In such a case employer shall deduct tax due on total
income. However, total amount of tax deducted should not be less than the amount of
tax deductible from salary except where the loss under the head Income from House
Property has been taken into account.
Section 193 – Interest on Securities
(a) Any person responsible for paying an interest on securities to a resident is
required to deduct tax at source at the rates in force on amount of interest
payable.

(b) The Tax is required to be deducted at the time of credit of such income to
the payees account or at the time of payment of interest on securities
whichever is earlier.

Section 194 – Dividends

(a) The Principal Officer of the Indian Company or a company, which has made
prescribed arrangements for declaration and payment of dividend in India is
responsible for deducting tax at source from dividend payable to a
shareholder, who is resident in India.

(b) No tax is to be deducted at source u/s 194 from Dividend payable to any
individual shareholder if the dividend is paid by the company by an account
payee cheque and the aggregate amount of dividend distributed/paid or
likely to be distributed/paid during the financial year does not exceed
Rs.2,500/-
Section 194A – Interest other than “Interest on Securities”

(a) Any person (except on individual or a HUF) responsible for paying interest
other than interest on securities to a resident is required to deduct tax at
Source

(b) TDS is required to be deducted either at the time of credit of such income to
the payees account or at the time of payment, whichever is earlier.

(c) No tax is deducted in case where the aggregate amount of interest does not
exceed Rs.5,000/-. In case of term deposits with banks or Cooperative
Society and Housing Finance Companies, no tax is required to be deducted
upto an aggregate interest of Rs.10,000/-.

(d) No tax is required to be deducted in case of interest paid/credited to any

banking company/financial corporation, LIC, UTI, etc.
Section 194B –Winning from Lottery or Crossword Puzzles

(a) Any person responsible for paying income by way of winning from
Lottery/crossword puzzle or card game or any other game is required to
deduct tax at source. From Rs. 5000 to Rs. 10000

(b) No tax is deductible if the amount of payment is Rs.5,000/- or less.

Section 194BB –Winning from Horse Races Rs. 2500 to Rs.5000

Section 194C – Payment to Contractor/Sub-contractors

(a)The payment is made by a resident contractor to a resident sub-contractor for carrying out he
whole or any part of the work undertaken by the contractor or for supplying whether wholly or
partly any labour, which the contractor has undertaken to supply.

(b) Tax is required to be deducted either the time of credit of the sum paid to the account of the
payee or at the time of payment in cash or by cheque or by any other mode, whichever is earlier.

(c) Contractor / prof fees Rs. 30000

Section 194D – Insurance Commission
(a) Any person responsible for paying insurance commission to a resident is
required to deduct tax at source. Rs. 5000 to Rs.20000

(b) No tax is deductible if the amount of insurance commission or aggregate of

the amount of such income credited/paid during the financial year does not
exceed Rs.5,000/-.

Section 194E – Payment to Resident Sportsman/Sports Association

(a) Any person responsible for paying any income to a non-resident sportsman
including an athlete who is not a Citizen of India or a non-resident Sports
Association or Institution is required to deduct tax at source.

(b) The tax is required to be deducted at the time of credit of such income to
the account of payee or at the time of payment in cash or by issue of
cheque or draft or by any other mode whichever is earlier.
Section 194EE – Payment in respect of deposits under National
Savings Scheme

(a) Any person responsible for paying to any person any amount referred to in
Section 80CCA(2) is required to deduct Income Tax.

(b) No deduction is required to be made where the amount of such payment or

the aggregate amount of such payments during the financial year is less
than Rs.2,500/-.

Section 194F – Payment on account of Repurchase of Units by

Mutual Funds or UTI

Any person responsible for paying to any person any amount referred to in
Section 80CCB(2) is required to deduct tax at source at the time of payment
without any exemption.
Section 194G – Commission etc. on the sale of Lottery Tickets
Any person who is responsible for paying commission, remuneration or prize to
any person who is or has been stocking, distributing, purchasing or selling
lottery tickets is required to deduct tax at source on such tickets on an amount
exceeding Rs.1,000/-.

Section 194H – Commission or Brokerage

a) Any person other than an individual or Hindu Undivided Family who is responsible for
paying on or after 1st June, 2001, to a resident, any income by way of commission (other than
insurance commission referred to in section 194D), or brokerage, is required to deduct tax.
From Rs.2500 to Rs.5000

(b) No deduction is required to be made where the amount of such income or

the aggregate of the amounts of such income credited/paid during the
financial year does not exceed Rs.2,500/-
Section 194 I – Rent Rs. 120000 to Rs.180000

(a) Any person other than an individual or Hindu Undivided Family responsible
for paying rent to resident any income by way of rent is required to deduct
tax.

(b) ‘Rent’ means any payment by whatever nature called, under any lease, sublease,
tenancy or any other agreement or arrangement for the use of
(either separately or together) any:

(i) land, or
(ii) building (including factory building), or
(iii) land appurtenant to a building (including a factory building), or
(iv) machinery, or
(v) plant, or
(vi) equipment, or
(vii) furniture, or
(viii) fittings
Any hire charges paid for hiring Motor Cars would also get covered under the ambit of TDS
u/s 194-I. The amendment has simply expanded the coverage of section 194-I to include
machinery or plant or equipment within its ambit.

c) From 1st June, 2002 an individual or a Hindu Undivided Family whose total sales or gross
receipts or turnover from business exceeds Rs.40 lacs or whose gross receipts from profession
exceeds Rs.10 lacs during the financial year immediately preceding the financial year in which
such sum is credited or paid shall be liable to deduct tax at source.

d) No deduction shall be made where the amount of such income or the aggregate of amounts
of such income credited/paid during the financial year does not exceed Rs.1,20,000/-.
(a) Any person other than individual or HUF responsible for paying to a resident fee for
professional services or fee for technical services is required to deduct tax on the income
comprised therein.

(b) The tax is required to be deducted at the time of credit of such income to the account of
the payee or at the time of payment in cash or by issue of cheques or drafts or by any other
mode whichever is earlier.

(c) No tax is required to be deducted in case amount of such sum or aggregate of amount of
such sums credited or paid during the financial year does not exceed Rs.20,000/-.
a) For tax-deductible u/s 192, 193, 194, 194A, 194C, 194D, 194G, 194H, 194- I, 194J, 194K,
194LA or 195.

(b) The recipient can apply in Form No.13 to the Assessing Officer to get a certificate
authorizing the payer to deduct tax at lower or deduct no tax as may be appropriate.

c) The certificate of lower rate shall be issued on plain paper directly to the person responsible
for paying income, under an advice to the applicant. Section 197 – Obtaining a Certificate of
Lower Rate from the Assessing Officer .

(d) However in the case of entities covered by Rule 28AB, the Assessing Officer may issue a
certificate to the recipient authoring payment of income without deduction of tax at source.
The recipient may furnish copies of such certificate to the person responsible for paying the
income for the purpose of no deduction of tax at source
THANK
YOU