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TDS TCS Rates for Financial Year 2020-21

Puja Sharma
May 25th, 2020 · 1 min read

The World Health Organization (WHO) first declared COVID-19 a world health emergency in January 2020. Since then, the whole of the world is suffering from the worst of the economic crisis caused by the pandemic COVID-19. The disease has spread to more than 200 countries worldwide and has disturbed the political, social, economic, religious and financial structures of the countries. Apart from saving the human lives, the biggest challenge which all the nations are facing at present is the revival of their economies which has been adversely effected by the virus. It is said that the effect of this pandemic will have longer effect on the economies than that of the 1929 great depression that started in USA. In order to reduce the impact of the COVID-19 crisis on its citizens, all the countries are announcing fiscal, monetary and various stimulus packages to provide a support to their citizens and thereby revival of their economy.

In India, the Government has been actively responding and monitoring the situation since January 2020. The Finance Ministry of the government has been keeping a close watch on the situation and has taken various majors to ensure ease of doing of business in this crisis. As a part of its relief measures, the Government has extended various dates of regulatory and statutory compliances to provide support to its taxpayers.

In order to provide more funds at the disposal of the taxpayers for dealing with the economic situation arising out of COVID-19 pandemic, the government has further announced the reduction of rates of Tax Deduction at Source (TDS) & Tax Collected at Source (TCS) by 25% for the FY 2020-21 w.e.f. 14.05.2020.

TDS rates chart applicable for the FY 2020-21

S. NoSection No.Nature of PaymentRate of TDS (1st April 2020 to 13th May 2020)Rate of TDS (14th May 2020 to 31st March 2021)
1193Interest on Securities10%7.5%
3194AInterest other than interest on securities10%7.5%
4194CPayment of contractors and sub-contractors1% (individual/HUF) 2% (Others)0.75% (individual/HUF) 1.5% (Others)
5194DInsurance Commission5%3.75%
6194DAPayment in respect of life insurance policy5%3.75%
7194EEPayments in respect of deposits under National Savings Scheme10%7.5%
8194FPayments on account of re-purchase of Units by Mutual Funds or UTI20%15%
9194GCommission, prize etc. on sale of lottery tickets5%3.75%
10194HCommission or brokerage5%3.75%
11194-I(a)Rent for plant and machinery2%1.5%
12194-I(b)Rent for immovable property10%7.5%
13194-IAPayment for acquisition of immovable property1%0.75%
14194-IBPayment of rent by individual or HUF5%3.75%
15194-ICPayment for Joint Development Agreements10%7.5%
16194JFee for Professional or Technical Services (FTS), Royalty, etc2% (FTS, certain royalties, call centre) 10% (others)1.5% (FTS, certain royalties, call centre) 7.5% (others)
17194KPayment of dividend by Mutual Funds10%7.5%
18194LAPayment of Compensation on acquisition of immovable property10%7.5%
19194LBA(1)Payment of income by Business trust10%7.5%
20194LBB(i)Payment of income by Investment fund10%7.5%
21194LBC(1)Income by securitisation trust25% (Individual/ HUF) 30% (Others)18.75% (Individual/ HUF) 22.5% (Others)
22194MPayment to commission, brokerage etc. by Individual and HUF5%3.75%
23194-OTDS on e-commerce participants1% (w.e.f. 1.10.2020)0.75%

TDS rates chart applicable for the FY 2020-21

S. NoSection No.Nature of ReceiptRate of TCS (1st April 2020 to 13th May 2020)Rate of TCS (14th May 2020 to 31st March 2021)
1206C(1)(a) Sale of Tendu Leaves5%3.75%
(b) Sale of Timber obtained under a forest lease2.50%1.875%
(c) Sale of timber obtained by any other mode2.50%1.875%
(d) Sale of any other forest produce not being timber/tendu leaves2.50%1.875%
(e) Sale of scrap1%0.75%
(f) Sale of Minerals, being coal or lignite or iron ore1%0.75%
2206C(1C)(a) Grant of license, lease, etc. of Parking lot2%1.50%
(b) Grant of license, lease, etc. of Toll Plaza2%1.50%
(c) Grant of license, lease, etc. of Minning and Quarrying2%1.50%
3206C(1F)Sale of motor vehicle above Rs. 10 lakhs1%0.75%
4206C(1H)Sale of any other goods0.1% (w.e.f 01.10.2020)0.75%

Note: In cases where the tax is required to be deducted or collected at higher rate due to non-furnishing of PAN/Aadhaar, the existing rate of 20% shall prevail.

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