Tax Deducted at Source (TDS) in India is a system under the Income Tax Act, 1961, where the person responsible for making certain payments deducts a specified percentage as tax before remitting the balance to the payee. The deducted tax is deposited with the government. Here is a detailed breakdown of the key provisions of TDS in India:

Here is the detailed table of TDS provisions in India for easy analysis:

1. Section 192 – TDS on Salary

• Applicability: TDS is deducted by the employer on salary payments made to employees.
• Rate of TDS: It depends on the employee’s income tax slab rates applicable after considering exemptions, deductions, and other income (if declared by the employee).
• Threshold: No TDS if the salary is below the basic exemption limit (currently ₹2.5 lakh for individuals, ₹3 lakh for senior citizens, and ₹5 lakh for super senior citizens).
• Declaration of other income: Employees can declare other income sources to their employer for accurate TDS computation.

2. Section 194A – TDS on Interest Other Than Interest on Securities

• Applicability: TDS on interest payments made by banks, post offices, and other entities (excluding interest on securities).
• Rate of TDS: 10%.
• Threshold:
  • ₹40,000 for interest from banks and post offices (₹50,000 for senior citizens).
  • No TDS if the interest is below this threshold.
• Form 15G/15H: Individuals whose total income is below the taxable limit can submit these forms to avoid TDS deduction.

3. Section 194C – TDS on Payment to Contractors

• Applicability: TDS on payments made to contractors and sub-contractors.
• Rate of TDS:
  • 1% for individuals/HUF.
  • 2% for companies/other entities.
• Threshold: No TDS if the payment is less than ₹30,000 for a single contract or ₹1,00,000 in aggregate during a financial year.
• Special cases: TDS applies even if the contract is for material supply where labour is also involved.

4. Section 194J – TDS on Fees for Professional or Technical Services

• Applicability: TDS on payments for professional, technical services, royalty, or non-compete fees.
• Rate of TDS: 10% (2% for technical services).
• Threshold: No TDS if the total payment in a financial year is below ₹30,000.

5. Section 194H – TDS on Commission and Brokerage

• Applicability: TDS on commission or brokerage payments.
• Rate of TDS: 5%.
• Threshold: No TDS if the amount is less than ₹15,000 in a financial year.

6. Section 194I – TDS on Rent

• Applicability: TDS on rent payments for land, building, furniture, plant, machinery, or equipment.
• Rate of TDS:
  • 10% for rent on land, building, or furniture.
  • 2% for rent on plant, machinery, or equipment.
• Threshold: No TDS if the total rent payment is less than ₹2,40,000 in a financial year.

7. Section 194IB – TDS on Rent by Individuals or HUF

• Applicability: Applicable when an individual or HUF (not liable for audit) pays rent exceeding ₹50,000 per month.
• Rate of TDS: 5%.
• Threshold: Only applicable if the rent exceeds ₹50,000 per month.

8. Section 194IC – TDS on Payment of Monetary Consideration under Joint Development Agreements

• Applicability: TDS on payments made under a joint development agreement to landowners.
• Rate of TDS: 10% of the monetary consideration paid.
• No Threshold: Applicable irrespective of the amount of payment.

9. Section 194IA – TDS on Transfer of Immovable Property

• Applicability: TDS on the sale of immovable property (other than agricultural land) if the transaction value exceeds ₹50 lakhs.
• Rate of TDS: 1%.
• Threshold: Applicable only if the consideration exceeds ₹50 lakh.
• No TDS if payment made by installment: If payments are in installments, TDS is deducted on each installment.

10. Section 194B – TDS on Winnings from Lotteries, Crossword Puzzles, etc.

• Applicability: TDS on winnings from lotteries, crossword puzzles, card games, and other similar games.
• Rate of TDS: 30%.
• Threshold: No TDS if the winnings are below ₹10,000.

11. Section 194C – TDS on Payment to Contractors

• Applicability: TDS on payments made to contractors for work (including supply of labor).
• Rate of TDS:
  • 1% for individuals/HUF contractors.
  • 2% for others.
• Threshold: No TDS if the payment is less than ₹30,000 per contract or ₹1 lakh aggregate in a financial year.

12. Section 194D – TDS on Insurance Commission

• Applicability: TDS on commissions paid to insurance agents.
• Rate of TDS: 5%.
• Threshold: No TDS if the amount is less than ₹15,000.

13. Section 194EE – TDS on Payments from National Savings Scheme

• Applicability: TDS on payments from National Savings Scheme accounts.
• Rate of TDS: 10%.
• Threshold: No TDS if the payment is less than ₹2,500.

14. Section 194F – TDS on Payments on Account of Repurchase of Units by Mutual Funds or UTI

• Applicability: TDS on payments by mutual funds/UTI for the repurchase of units.
• Rate of TDS: 20%.
• No Threshold: TDS is deducted irrespective of the amount.

15. Section 195 – TDS on Payments to Non-Residents

• Applicability: TDS on any payment to a non-resident that is chargeable to tax in India.
• Rate of TDS: Varies depending on the nature of the income (e.g., 20% on royalty, 10% on technical fees, etc.).
• No Threshold: TDS is deducted irrespective of the amount.

16. Section 196D – TDS on Income of Foreign Institutional Investors (FIIs)

• Applicability: TDS on income from securities (other than interest referred to in section 194LD) of Foreign Institutional Investors.
• Rate of TDS: 20%.
• No Threshold: TDS is deducted on all payments to FIIs.

17. Section 194Q – TDS on Purchase of Goods

• Applicability: Applicable to buyers purchasing goods from residents where the total sales exceed ₹50 lakh in a financial year.
• Rate of TDS: 0.1%.
• Threshold: Applicable if purchases exceed ₹50 lakh in a financial year.

18. Section 194S – TDS on Payment for Transfer of Virtual Digital Assets (VDA)

• Applicability: TDS on payment for the transfer of Virtual Digital Assets (cryptocurrency, etc.).
• Rate of TDS: 1%.
• Threshold: No TDS if the total consideration does not exceed ₹50,000 (for specified persons) or ₹10,000 (for others).

19. Section 206C(1H) – TCS on Sale of Goods

• Applicability: Tax Collected at Source (TCS) is required to be collected by the seller on the sale of goods over ₹50 lakh.
• Rate of TCS: 0.1%.
• Threshold: Applicable only on sales exceeding ₹50 lakh.

Late Filing of TDS Return and Interest on Late Deduction/Deposit

• Interest: For late deduction or non-deduction of TDS, interest is charged at 1% per month (or part of the month) and for late deposit, it is 1.5% per month.
• Late Fees: A penalty of ₹200 per day is levied for delayed filing of TDS returns, subject to a maximum of the TDS amount.

Key Points to Remember:

• TAN (Tax Deduction and Collection Account Number): Required for all entities deducting TDS.
• TDS Returns: Must be filed quarterly in Form 24Q (salary) or 26Q (non-salary).
• TDS Certificate: The deductor must issue Form 16 (for salary) and Form 16A (for other payments) to the deductee.
• TDS Refund: If excess TDS is deducted, it can be claimed as a refund while filing the income tax return.

These provisions are subject to amendments and updates in the Finance Act each year.