TDS Rates
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TDS or Tax Deducted from Source is the type of tax which an individual is liable to pay. The tax deducted from an employee's income goes to activities such as development of infrastructure, defense etc. If the TDS deducted is greater than the actual tax amount, an employee is eligible for TDS Refund. To receive the refund amount on TDS, the individual is required to file TDS Return. The TDS collected depends on the income that an individual is drawing, age of the employee, interest incurred etc and it can be collected on an annual, monthly or biannual basis.
TDS Rate on Salary
The employer has authority to file TDS on the employee's behalf. TDS can be deducted from the salary only at the time the employee is receiving their salary. However, if the annual income that an individual is earning comes below the minimum taxable income slab, TDS will not be deducted from your income. The TDS rate varies from 5-30%
The chart below shows TDS amount applicable on any amount of payment:
Particulars |
TDS Rates (in %) |
|
Section 192: Payment of salary |
According to Income Slab as specified above |
|
Section 192A: Payment of accumulated balance of provident fund which is taxable in the hands of an employee (with effect from 01.06.2015). |
10 |
|
Section 193: Interest on securities |
|
|
a) any debentures or securities for money issued by or on behalf of any local authority or a corporation established by a Central, State or Provincial Act; |
10 |
|
b) any debentures issued by a company where such debentures are listed on a recognized stock exchange in accordance with the Securities Contracts (Regulation) Act, 1956 (42 of 1956) and any rules made there under; |
10 |
|
c) any security of the Central or State Government; |
10 |
|
d) interest on any other security |
10 |
|
Section 194: Dividend other than the dividend as referred to in Section 115-O |
10 |
|
Section 194A: Income by way of interest other than "Interest on securities" |
10 |
|
Section 194B: Income by way of winnings from lotteries, crossword puzzles, card games and other games of any sort |
30 |
|
Section 194BB: Income by way of winnings from horse races |
30 |
|
Section 194C: Payment to contractor/sub-contractor |
|
|
a) HUF/Individuals |
1 |
|
b) Others |
2 |
|
Section 194D: Insurance commission |
5 (10% till Assessment year 2016-17) |
|
Section 194DA: Payment in respect of life insurance policy |
1 (2% till 31-5-2016) |
|
Section 194EE: Payment in respect of deposit under National Savings scheme |
10 (20% till 31-5-2016) |
|
Section 194F: Payment on account of repurchase of unit by Mutual Fund or Unit Trust of India |
20 |
|
Section 194G: Commission, etc., on sale of lottery tickets |
5 (10% till 31-5-2016) |
|
Section 194H: Commission or brokerage |
5 (10% till 31-5-2016) |
|
Section 194-I: Rent |
|
|
a) Plant & Machinery |
2 |
|
b) Land or building or furniture or fitting |
10 |
|
Section 194-IA: Payment on transfer of certain immovable property other than agricultural land |
1 |
|
Section 194J: Any sum paid by way of a) Fee for professional services, b) Fee for technical services c) Royalty, d) Remuneration/fee/commission to a director or e) For not carrying out any activity in relation to any business f) For not sharing any know-how, patent, copyright etc. |
10 |
|
Section 194LA: Payment of compensation on acquisition of certain immovable property |
10 |
|
Section 194LBA(1): Business trust shall deduct tax while distributing, any interest received or receivable by it from an SPV or any income received from renting or leasing or letting out any real estate asset owned directly by it, to its unit holders. |
10 |
|
Section 194LBB: Investment fund paying an income to a unit holder [other than income which is exempt under Section 10(23FBB)] |
10 |
|
Section 194LBC: Income in respect of investment made in a securitization trust (specified in Explanation of Section 115TCA) |
25% in case of Individual or HUF 30% in case of other person |
|
Any Other Income |
10 |
Income Tax Slab
Normal tax rates applicable to a resident individual below the age of 60 years i.e. born on or after 1.4.1958
|
Net income range |
Income-tax rates |
Health and Education Cess |
|
Up to Rs. 2,50,000 |
Nil |
Nil |
|
Rs. 2,50,000 – Rs. 5,00,000 |
5% of (total income minus Rs. 2,50,000) [*] |
4% of income tax |
|
Rs. 5,00,000 – Rs. 10,00,000 |
Rs. 12,500 + 20% of (total income minus Rs. 5,00,000) |
4% of income tax |
|
Above Rs. 10,00,000 |
Rs. 1,12,500 + 30% of (total income minus Rs. 10,00,000) |
4% of income tax |
Normal tax rates applicable to a resident individual of the age of 60 years or above at any time during the year but below the age of 80 years
|
Net income range |
Income-tax rates |
Health and Education Cess |
|
Up to Rs. 3,00,000 |
Nil |
Nil |
|
Rs. 3,00,000 – Rs. 5,00,000 |
5% of (total income minus Rs.3,00,000) [*] |
4% of income-tax |
|
Rs. 5,00,000 – Rs. 10,00,000 |
Rs. 10,000 + 20% of (total income minus Rs. 5,00,000) |
4% of income-tax |
|
Above Rs. 10,00,000 |
Rs. 1,10,000 + 30% of (total income minus Rs. 10,00,000) |
4% of income-tax |
Normal tax rates applicable to a resident individual of the age of 80 years or above at any time during the year
|
Net income range |
Income-tax rates |
Health and Education Cess |
|
Up to Rs. 5,00,000 |
Nil |
Nil |
|
Rs. 5,00,000 – Rs. 10,00,000 |
20% of (total income minus Rs. 5,00,000) |
4% of income-tax |
|
Above Rs. 10,00,000 |
Rs. 1,00,000 + 30% of (total income minus Rs. 10,00,000) |
4% of income-tax |
Non-resident individual irrespective of age
|
Net income range |
Income-tax rates |
Health and Education Cess |
|
Up to Rs. 2,50,000 |
Nil |
Nil |
|
Rs. 2,50,000 – Rs. 5,00,000 |
5% of (total income minus Rs. 2,00,000) [*] |
4% of income-tax |
|
Rs. 5,00,000 – Rs. 10,00,000 |
Rs. 12,500 + 20% of (total income minus Rs. 5,00,000) |
4% of income-tax |
|
Above Rs. 10,00,000 |
Rs. 1,12,500 + 30% of (total income minus Rs. 10,00,000) |
4% of income-tax |
Normal tax rate applicable to resident/non-resident Hindu Undivided Family (HUF)
|
Net income range |
Income-tax rates |
Health and Education |
|
Up to Rs. 2,50,000 |
Nil |
Nil |
|
Rs. 2,50,000 – Rs. 5,00,000 |
5% of (total income minus Rs.2,50,000) |
4% of income-tax |
|
Rs. 5,00,000 – Rs. 10,00,000 |
Rs. 12,500 + 20% of (total income minus Rs. 5,00,000) |
4% of income-tax |
|
Above Rs. 10,00,000 |
Rs. 1,12,500 + 30% of (total income minus Rs. 10,00,000) |
4% of income-tax |
Normal tax rates applicable to every AOP/BOI/Artificial juridical person
|
Net income range |
Income-tax rates |
Health and Education |
|
Up to Rs. 2,50,000 |
Nil |
Nil |
|
Rs. 2,50,000 – Rs. 5,00,000 |
5% of (total income minus Rs. 2,50,000) |
4% of income-tax |
|
Rs. 5,00,000 – Rs. 10,00,000 |
Rs. 12,500 + 20% of (total income minus Rs. 5,00,000) |
4% of income-tax |
|
Above Rs. 10,00,000 |
Rs. 1,12,500 + 30% of (total income minus Rs. 10,00,000) |
4% of income-tax |
Normal tax rates applicable to a Co-operative societies
|
Net income range |
Rate of income-tax |
|
Up to Rs. 10,000 |
10% |
|
Rs. 10,000 - Rs. 20,000 |
20% |
|
Above Rs. 20,000 |
30% |
FAQs
What is TDS Certificate?
TDS refers to Tax Deducted at Source. Generally, this certificate is issued by the employer to the employee. There are two types of TDS Certificates, namely, Form 16 and Form 16A
What is Form 16?
The tax deducted from an employee's income over the financial year is recorded in Form 16. It is issued by employer to the employees.
What is Form 16A?
Form 16A is filled for the tax deducted for all the payments made apart from the salary. This form is filled for transactions like bank interest payments, rent etc and submitted to the IT Department.
What is the TDS rate applicable on securities?
A TDS rate of 10% is applicable on securities.
What is the limit for exemption on TDS for employees below 60 years of age?
Individuals below 60 years of age and earning below 2.5 lakhs are eligible for exemption from TDS.
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