[ad_1]
TDS rates for FY 2024-25: Tax Deducted at Source (TDS) is a mechanism by which the government collects tax directly from the source of income. It applies to a variety of incomes such as salary, interest on bank deposits, commission, house rent, and dividends, among others. However, the rate of TDS deduction varies based on specific rules.
For instance, if an individual pays house rent of Rs 50,000 or more, they are required to deduct TDS at a rate of 5% before making the payment to the landlord.
It’s important to adhere to the prescribed rules regarding TDS deduction and filing TDS returns. Failure to comply can lead to penalties, and in severe cases, imprisonment is possible, states an ET report.
Abhishek Soni, co-founder of Tax2Win, was quoted as saying, “TDS rates vary depending on the nature and amount of income, as well as the status of the recipient (whether they are a resident, a non-resident, etc.). In some severe cases, the deductor may face prosecution and imprisonment for up to seven years if they wilfully fail to deduct or deposit the TDS, as stipulated under section 276B of the Income-tax Act 1961. This legal action has serious consequences and may have long-lasting implications for the deductor.”
Understanding how TDS works and knowing TDS rates
When making a payment subject to TDS, the payer must deduct a specified percentage of the amount paid. The recipient then receives a TDS certificate from the deductor, indicating the amount deducted.
For instance, in cases where monthly house rent exceeds Rs 50,000, the tenant must provide the landlord with Form 16C (TDS certificate) within 15 days from the due date of filing TDS return. Upon receiving the certificate, the deductee can claim the TDS amount as tax paid for the respective financial year. The TDS deposit reflects in the deductee’s Form 26AS and Annual Information Statement (AIS).
For instance, if an individual pays house rent of Rs 50,000 or more, they are required to deduct TDS at a rate of 5% before making the payment to the landlord.
It’s important to adhere to the prescribed rules regarding TDS deduction and filing TDS returns. Failure to comply can lead to penalties, and in severe cases, imprisonment is possible, states an ET report.
Abhishek Soni, co-founder of Tax2Win, was quoted as saying, “TDS rates vary depending on the nature and amount of income, as well as the status of the recipient (whether they are a resident, a non-resident, etc.). In some severe cases, the deductor may face prosecution and imprisonment for up to seven years if they wilfully fail to deduct or deposit the TDS, as stipulated under section 276B of the Income-tax Act 1961. This legal action has serious consequences and may have long-lasting implications for the deductor.”
Understanding how TDS works and knowing TDS rates
When making a payment subject to TDS, the payer must deduct a specified percentage of the amount paid. The recipient then receives a TDS certificate from the deductor, indicating the amount deducted.
For instance, in cases where monthly house rent exceeds Rs 50,000, the tenant must provide the landlord with Form 16C (TDS certificate) within 15 days from the due date of filing TDS return. Upon receiving the certificate, the deductee can claim the TDS amount as tax paid for the respective financial year. The TDS deposit reflects in the deductee’s Form 26AS and Annual Information Statement (AIS).
TDS rates for FY 2024-25
Below is a table illustrating the TDS rates applicable for salary, house rent, shares, and other prescribed transactions in the financial year 2024-25:
Source: Abhishek Soni, co-founder, Tax2Win (a tax filing assistance company) as quoted by ET
#Tax #Deducted #Source #guide #TDS #rates #incomes #checklist
