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Concessional TDS rates for the remaining period of Financial Year 2020-21

concessional tds rates for fy 2020-21

The finance minister Nirmala Sitharaman in her recent press briefing has announced concessional TDS/TCS rates which will come into effect from May 14, 2020, for the remaining period of Financial Year 2020-21 i.e. from 14th May 2020 to 31st March 2021.

The Government on 13th May 2020 has announced various relief measures for the common man so that we can fight against the financial distress caused by COVID-19.

Press Release – Ministry of Finance

One among many relief is the reduction in the tax rates by 25% under TDS – Tax deducted at source.

All about TDS – Tax Deducted at Source

Concessional TDS Rates applicable from 14th May 2020 to 31st March 2021.

Nature of PaymentRelevant
TDS effective rate till 13th May 2020TDS effective rate from 14th May 2020
TDS from withdrawal from employees provident fund scheme192A10%10%
Interest on securities19310%7.5%
Deduction of tax at source from dividends19410%7.5%
Interest other than interest on securities194A10%7.5%
Winnings from lotteries or crossword puzzles194B30%30%
Winning from horse races194BB30%30%
TDS on contractors and sub-contractors194C1% (In case of Individual/ HUF)
2% (In other cases)
0.75% (In case of Individual/ HUF)
1.5% (In other cases)
Insurance commission194D5%3.75%
Payment of life insurance policy in excess of Rs.1Lakh other than exempted under section 10(10D)194DA5%3.75%
Payments on account of re-purchase of Units by Mutual Funds or UTI194F20%15%
Commission, prize etc., on sale of lottery tickets194G5%3.75%
TDS on commission or brokerage in excess of Rs.15,000/-194H5%3.75%
Rent for plant and Machinery194-I(a)2%1.5%
Rent for immovable property194-I(b)10%7.5%
Payment on transfer of certain immovable properties (other than agricultural land)194-IA1%0.75%
Payment of rent of property by certain individuals/HUFs194-IB5%3.75%
Payment for Joint Development Agreements194-IC10%7.5%
In respect of income from units of Mutual funds194K10%7.5%
In respect of payment made to professional or commission or brokerage of more than Rs.50,00,000/- and above194M5%3.75%
In case of cash withdrawal exceeding Rs. 20 Lakh or Rs.1 Crore as the case may be194N2%2%
Fees for professional fees etc194J(a) 2% in case of (FTS, certain royalties, call centre)
(b) 10% in other cases
(a) 1.5% in case (FTS, certain royalties, call centre)
(b) 7.5% in other cases
Payments in respect of deposits under National savings scheme194EE10%7.5%
Payment of income by the Business trust194LBA(1)
Payment of income by Investment fund
Income by the securitization trust194LBC(1)(a) 25% (Individual/HUF)
(b) 30% (Others)
(a) 18.75% (Individual/HUF)
(b) 22.5% (Others)
TDS on e-commerce participants194-O1% (which is going to be effective from 1st October 2020)0.75%
By CA Devesh Thakur

Points to remember:-

  1. This relief is not available under TDS if section 206AA is applicable i.e. if the deductee has not furnished its PAN/Aadhaar. In that case, the TDS rate will be applicable as per Section 206AA i.e. at the rate of 20% and not on 15%.
  2. This relief is provided only for the remaining period of financial year 2020-21 i.e. till 31st march 2021

You can refer our video for New TDS rates

Concessional TCS rates for the remaining period of Financial Year 2020-21

“Subscribe” to our blogs for latest updates on Tax deducted at Source.

CA Devesh Thakur



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