Tax Deducted at Source (TDS) is a crucial mechanism under the Indian Income Tax Act, ensuring tax collection at the source of income generation. The government regularly updates TDS rates to align with economic policies and revenue needs. This article provides a detailed overview of the TDS rate chart for the Financial Year (FY) 2024-25, including key changes and their implications.
TDS Rates Chart for FY 2024-25 (AY 2025-26)
Below is a summary of the TDS rates applicable for FY 2024-25:
| Section | Nature of Payment | Threshold Limit (₹) | TDS Rate (%) |
| 192 | Salary | Basic exemption limit | Slab rates |
| 192A | Premature EPF withdrawal | 50,000 | 10% (20% without PAN) |
| 194A | Interest on deposits | 50,000 (senior citizens), 40,000 (others) | 10% |
| 194B | Lottery winnings | 10,000 | 30% |
| 194C | Contractor payments | 30,000 (single), 1,00,000 (aggregate) | 1% (HUF/Individuals), 2% (others) |
| 194D | Insurance commission | 15,000 | 5% (2% from April 2025) |
| 194G | Lottery ticket commission | 15,000 | 5% (2% from October 2024) |
| 194H | Brokerage/commission | 15,000 | 5% (2% from October 2024) |
| 194-I | Rent | 2,40,000 | 2% (plant/machinery), 10% (land/building) |
| 194IA | Payment on transfer of certain immovable property other than agricultural land | 50,00,000 | 1% |
| 194J | Professional fees | 30,000 | 2% (technical services), 10% (others) |
| 194Q
194N |
Payment for Purchase of goods
Cash withdrawals |
50,00,000
1 crore (3 crore for co-op societies) |
0.1%
2% (5% for non-filers) |
| 194S | Virtual digital assets | 50,000 (specified persons), 10,000 (others) | 1% |
Key Updates in TDS Rates for FY 2025-26
The Union Budget 2025 introduced several changes to TDS rates and threshold limits, aiming to simplify compliance and reduce the tax burden on individuals and businesses. Below are the significant updates:
- Interest Income (Section 194A)
- Revised Exemption Limit: ₹1,00,000 for senior citizens (up from ₹50,000) and ₹50,000 for others (up from ₹40,000).
- TDS Rate: 10% for interest earned from banks, post offices, and cooperative societies.
- Rent Payments (Section 194-I)
- Revised Exemption Limit: ₹6,00,000 per annum (up from ₹2,40,000).
- TDS Rate: 2% for plant and machinery; 10% for land, building, or furniture.
- Dividend Income (Section 194)
- Revised Exemption Limit: ₹10,000 (up from ₹5,000).
- TDS Rate: 10% for dividends paid by domestic companies.
- Commission and Brokerage (Section 194H)
- Revised Exemption Limit: ₹20,000 (up from ₹15,000).
- TDS Rate: Reduced from 5% to 2% (effective from October 1, 2024).
- Professional or Technical Services (Section 194J)
- Revised Exemption Limit: ₹50,000 (up from ₹30,000).
- TDS Rate: 2% for technical services; 10% for other professional services.
- Overseas Remittances (Section 206C(1G))
- Revised Exemption Limit: ₹10,00,000 (up from ₹7,00,000).
- TCS Rate: 5% for remittances under the Liberalised Remittance Scheme (LRS).
Implications of the Revised TDS Rates
- Reduced Tax Burden: The increased exemption limits and reduced TDS rates benefit taxpayers, especially senior citizens and small businesses.
- Simplified Compliance: Higher thresholds reduce the frequency of TDS deductions, easing compliance for payers and recipients.
- Encouragement for Investments: Higher dividend exemption limits promote equity investments, while lower TDS rates on professional fees support consultants and freelancers.
Key TDS Provisions for FY 2024-25
- PAN Requirement: If the deductee does not provide a PAN, TDS is deducted at a higher rate (usually 20%).
- Due Date for TDS Payment:
- For non-government deductors: 7th of the following month.
- For March: 30th April.
- TDS Return Filing Due Dates:
- Q1 (April-June): 31st July
- Q2 (July-September): 31st October
- Q3 (October-December): 31st January
- Q4 (January-March): 31st May
- Form 16/16A Issuance:
- Form 16 (Salary) – 15th June
- Form 16A (Other TDS) – 15 days from filing return
- Lower/Nil TDS Certificate: Deductees can apply for a lower or nil deduction certificates using Form 13.
Conclusion
The updated TDS rate chart for FY 2024-25 reflects the government’s efforts to streamline tax compliance while providing relief to taxpayers. Staying informed about these changes is crucial for proper tax planning and compliance. You can also read here Tax rates for individuals.