TDS Provisions for Financial Year 2021-22

S.No. Section Head (Nature of Payment) Rate of TDS Cut Off Amount
1. 192 Salary Average Rate No TDS if amount paid does not exceed taxable income (after taking into consideration other incomes, losses and deduction under chapter VIA (80Cto 80U) and rebates as per details furnished by employee.)
2. 194A Interest other than interest on securities 10% a) Rs .40000/- If interest on Time Deposit paid by bank, co-operative society, or on a post office deposit.

b) If payee is senior citizen then limit would be Rs. 50000-/.
c) Rs. 5000 in any other case
3. 194C Contractors/Sub Contractors 1% if paid to Individual/HUF 2% if paid to person other than individual/HUF a) Rs.30000/- in single transaction.
OR
b) Rs.100000/- during the financial year.
4. 194H Commission /Brokerage 5% Rs.15,000 /-
5. 194I Rent 2% for use of Plant / Machinery/Equipment
10% for use of any Land/Building/Furniture /Fitting		 Rs. 240000/-
6. 194IA Transfer of Immovable property other than Agriculture Land 1% Rs.50 lacs/-(limit is property -wise and not transferee- wise)
7. 194J Professional Fees/Technical Services 2% for Technical Services, and 10% for professional services (amended by Finance Bill, 2020) a) Rs. 30000/- in case of Professional Fees, Royalty, Technical Fees, Non-compete fees
b) No limit for Director’s fees.

Contract Vs Commission/Brokerage

Other points to consider

  1.  If a person is employed with more than two employers during the previous year, he may furnish the particulars of income and TDS to the employer of his choice.
  2. In case of salary TDS will be deducted at time of payment but in other cases TDS will be deducted at the time of credit or payment whichever is earlier.
  3. No requirement of TAN for buyer u/s 194IA.He will deposit TDS through form 26 QB i.e. challan-cum- statement electronically within 30th day from the end of month in which TDS is deducted.
    Buyer will issue TDS certificate 16B to the seller within 15 days from the due date of deposit of TDS i.e. 15th day of month.
  4. Individual and HUF will be liable to deduct TDS u/s 194A/194C/194H/194I/194J only when they have turnover from business of more than Rs. 1 Crore or gross receipts from profession of more than Rs. 50 Lakhs in the year immediately preceding financial year.
  5.  In all above cases if deductee does not provide PAN to the deductor TDS has to be deducted @ 20% or rate in force whichever is high.
  6. TDS will not be deducted if PAN is furnished by transport contractor (who is under the business of plying, hiring, or leasing goods carriages).
  7.  U/s 194C & 194I TDS is deductible on gross consideration i.e. excluding GST.
  8. TDS certificate should be issued within 15 days from the last date of filing of TDS return. In case of Form 16, the TDS Certificate should be issued by 31st May.

Applicability of Surcharge/ Cess on TDS

Payment to Nature of Payment Surcharge Cess
Resident Non Corporate Salary up to 1 crore No Yes (4%)
Salary between 50 Lakhs to 1 Crore Yes (10%) Yes (4%)
Salary between 1 Crore to 2 Crore Yes (15%) Yes (4%)
Salary between 2 Crore to 5 Crore Yes (25%) Yes (4%)
Above 5 Crore Yes (37%) Yes (4%)
Other than salary No No
Corporate No No
Non Resident Non Corporate Salary up to 50 Lakhs No Yes (4%)
Salary between 50 Lakhs to 1 Crore Yes (10%) Yes (4%)
Salary between 1 Crore to 2 Crore Yes (15%) Yes (4%)
Salary between 2 Crore to 5 Crore Yes (25%)
Above 5 Crore Yes (37%)
Other than salary:
Up to 1 crore No Yes (4%)
Between 50 Lakhs to 1 Crore Yes (10%) Yes (4%)
Salary between 1 Crore to 2 Crore Yes (15%) Yes (4%)
Salary between 2 Crore to 5 Crore Yes (25%) Yes (4%)
Above 5 Crore Yes (37%) Yes (4%)
Corporate Up to 1 crore No Yes (4%)
Less than 1 crore but up to 10 crore Yes (2%) Yes (4%)
Above 10 crore Yes (5%) Yes (4%)

For limit of Surcharge on net income (Taxable Income after taking deductions) to be check.

Time limit for filing TDS returns and issuance of Form 16/16A:

 Quarter  Quarter ended  Due date for filing of TDS return Due date for issuance of Form 16A
 I  30 June  31 July  15 August
 II  30 September  31 October  15 November
 III  31 December  31 January  15 February
 IV  31 March  31 May  15 June