TDS on Payment for Transfer of Virtual Digital Assets (VDAs) Introduction As per Section 194S, TDS must be deducted at a rate of 1% on payments made to a resident for the transfer of Virtual Digital Assets (VDAs). Key Provisions Deductor: o Any person (resident or non-resident) making payment for the transfer of VDAs. o In… Read More »
TDS on Benefit or Perquisite from Business or Profession Introduction Section 194R provides that TDS must be deducted at 10% on any benefit or perquisite provided to a resident in relation to business or profession. The tax must be deducted before providing the benefit or perquisite. Key Provisions Deductor:Any person (resident or non-resident) providing a benefit… Read More »
TDS on Purchase of Goods Introduction TDS must be deducted under section 194Q at 0.1% on payments made to a resident seller for the purchase of goods if the buyer’s turnover exceeds Rs. 10 crore in the preceding financial year and the total purchase value exceeds Rs. 50 lakh in a financial year. Key Provisions Deductor: o… Read More »
TDS on Pension and Interest Income of Senior Citizens Introduction Section 194P provides that specified banks must deduct TDS on pension and interest income of senior citizens aged 75 years or more. If tax is deducted under this provision, the senior citizen is not required to file an income tax return. Key Provisions Deductor:Scheduled banks appointed… Read More »
TDS on Cash Withdrawals Introduction Banks, co-operative banks, and post offices must deduct TDS under section 194N on cash withdrawals exceeding specified limits from accounts maintained by the recipient. The TDS rate is 2% or 5%, as applicable. Key Provisions Deductor:Any bank, co-operative bank, or post office making cash payments above the threshold limit. Deductee:Applies to all… Read More »
TDS on Payments to Contractors or Professionals by Certain Individuals or HUFs Introduction As per section 194M, individuals and HUFs who are not liable to deduct tax under Sections 194C, 194H, or 194J must deduct TDS at 2% on payments to contractors, commission agents, brokers, or professionals if the total amount exceeds Rs. 50 lakh in a financial year. Key… Read More »
TDS on Interest Paid on Foreign Borrowings Introduction As per section 194LC, Indian companies and business trusts must deduct TDS on interest paid to non-residents or foreign companies for specified foreign borrowings, including long-term infrastructure bonds and rupee-denominated bonds. Key Provisions Deductor:Any Indian company or business trust making interest payments in respect of foreign borrowings. Deductee:Non-residents… Read More »
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TDS on Income from Investment in Securitization Trust Introduction TDS must be deducted under section 194LBC on income paid to investors in a Securitization Trust, regardless of their residential status. Key Provisions Deductor:Any person making payments related to investments in a Securitization Trust. Deductee:All investors (both residents and non-residents). Rate of TDS: o For Residents: 10% o… Read More »
TDS on Income Distributed by Investment Funds Introduction Investment funds must deduct TDS under section 194LBB on income (other than business profits) distributed to unit holders, regardless of their residential status. Key Provisions Deductor:The Investment Fund making the distribution. Deductee:All unit holders (both residents and non-residents). Rate of TDS: o For Residents: 10% on distributed income. o… Read More »