Entities responsible to deduct TDS or Tax Deducted at Source under the Income Tax (I-T) law must deduct a certain portion of the payment involved and submit it to the I-T Department. The TDS rate on income may vary between 10% and 30%.
Basically, the TDS rate varies from one transaction to another. This guide will help you understand the TDS rate on transactions.
For the uninitiated, those making payments like salary, rent, payment for house purchase, etc., are required to collect TDS and pay it to the I-T Department on behalf of the payees. Those paying perks, commissions, dividends, payment earned for various services, fixed deposits, etc., should also deduct TDS.
Also read our guide to understand all about TDS and TDS online payment.
TDS rate chart
| Applicable section | Nature of payment | TDS rate for individual or HUF, as a percentage of the transaction value |
| 192 | Salary | According to income tax slab |
| 192A | Premature withdrawal from EPF | 10% |
| 193 | Interest on securities | 10% |
| 194 | Payment of any dividend | 10% |
| 194A | Interest from sources other than interest on securities under Section 193 and interest from banks/post office/co-operative society | 10% |
| 194B | Income earned from card games, lotteries and other games | 30% |
| 194BB | Income earned from horse racing | 30% |
| 194C | Payment to contractor/sub-contractor | 1% |
| 194EE | Deposits made to National Savings Scheme | 10% |
| 194F | Payment for repurchase of units by Unit Trust of India or mutual funds | 20% |
| 194G | Income from lottery tickets sales commissions and/or other transactions | 5% |
| 194H | Commission or brokerage | 5% |
| 194-I | Rent on plant and machinery | 2% |
| 194-I | Rent on land or buildings or furniture or fittings | 10% |
| 194-IA | Payments made for the purchase of immovable property other than agricultural land | 1% |
| 194-IB | Rent payment by an individual/ HUF not covered under Section 194-I | 5% |
| 194-IC | Payment under joint development agreements | 10% |
See also: All about TDS on sale of property under Section 194-IA
Read about : TDS full form
TDS rate chart for non-resident Indians (NRIs)
| Applicable section | Income type | Percentage of TDS to be deducted from the transaction value |
| 192 | Salary | According to tax slab |
| 192A | Premature withdrawal from EPF | 10% |
| 194B | Income earned from card games, lotteries and other games | 30% |
| 194BB | Income earned from horse racing | 30% |
|
194E |
Payment to NRI sportsman or non-resident sports association | 20% |
| 194EE | Deposits made to National Savings Scheme | 10% |
| 194F | Payment for repurchase of units by Unit Trust of India or mutual funds | 20% |
| 194G | Income from lottery tickets sales, commissions and/or other transactions | 5% |
| 194LB | Compensation payment for acquisition of certain immovable property | 5% |
| 194LBC
|
Income from investments in securitisation fund | 30% |
| 195 | Payment of any other sum to a non-resident | 20% |
| Income by way of long-term capital gains referred to in Section 115E in case of an NRI citizen | 10% | |
| Income by way of long-term capital gains referred to in sub-clause (iii) of clause (c) of sub-Section (1) of Section 112 | 10% | |
| Income by way of long-term capital gains as referred to in Section 112A | 10% | |
| Income by way of short-term capital gains referred to in Section 111A | 15% | |
| Any other income by way of long-term capital gains [not being long-term capital gains referred to in clauses 10(33), 10(36) and 112A] | 20% | |
| Income by way of interest payable by the government or an Indian concern on amount borrowed or debt incurred by the government or the Indian concern in foreign currency (not being income by way of interest referred to in Section 194LB or Section 194LC) | 20% | |
| Income by way of royalty payable by the government or an Indian concern in pursuance of an agreement made by it with the government or the Indian concern, where such royalty is in consideration for the transfer of all or any rights (including the granting of a licence) in respect of copyright in any book on a subject referred to in the first proviso to sub-section (1A) of Section 115A of the I-T Act, to the Indian concern, or in respect of any computer software referred to in the second proviso to sub-section (1A) of Section 115A of the I-T Act, to an Indian resident | 10% | |
| Income by way of royalty not being royalty of the nature referred to point above payable by the government or an Indian concern in pursuance of an agreement made by it with the government or the Indian concern and where such agreement is with an Indian concern, the agreement is approved by the central government or where it relates to a matter included in the industrial policy, for the time being in force, of the Indian government, the agreement is in accordance with that policy | 10% | |
| Income by way of fees for technical services payable by the government or an Indian concern in pursuance of an agreement made by it with the government or the Indian concern and where such agreement is with an Indian concern, the agreement is approved by the central government or where it relates to a matter included in the industrial policy, for the time being in force, of the government of India, the agreement is in accordance with that policy | 10% | |
| Any other income | 30% |
Source: Income-Tax Department
See also: All about Form 15G. Also check our guide on TDS return due date
An alumna of the Indian Institute of Mass Communication, Dhenkanal, Sunita Mishra brings over 16 years of expertise to the fields of legal matters, financial insights, and property market trends. Recognised for her ability to elucidate complex topics, her articles serve as a go-to resource for home buyers navigating intricate subjects. Through her extensive career, she has been associated with esteemed organisations like the Financial Express, Hindustan Times, Network18, All India Radio, and Business Standard.
In addition to her professional accomplishments, Sunita holds an MA degree in Sanskrit, with a specialisation in Indian Philosophy, from Delhi University. Outside of her work schedule, she likes to unwind by practising Yoga, and pursues her passion for travel.
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