Revised TDS Rates and Limit w.e.f 01.06.2016

Finance Act 2016 has revised TDS Rates and limit for Rationalization of tax deduction at Source (TDS)

Under the scheme of deduction of tax at source as provided in the Act, every person responsible for payment of any specified sum to any person is required to deduct tax at source at the prescribed rate and deposit it with the Central Government within specified time. However, no deduction is required to be made if the payments do not exceed prescribed threshold limit.

In order to rationalise the rates and base for TDS provisions, the threshold limit for deduction of tax at source and the rates of deduction of tax at source have been revised with effect from 1-6-2016 as mentioned in Table 1 and Table 2 respectively.Certain non-operational provisions to be omitted  w.e.f 01.06.2016 as mentioned in Table 3

Table 1: Increase in threshold limit of deduction of tax at source on various payments mentioned in the relevant sections of the Act

[table id=25 /]

Table-2 : Revision in rates of deduction of tax at source on various payments mentioned in the relevant sections of the Act:

[table id=26 /]

Table -3 :Certain non-operational provisions to be omitted  w.e.f 01.06.2016

[table id=27 /]

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1. The amendment is effected in Entry 1(a)(iv) of Part II of First Schedule specifying the rate of deduction of tax at source in case of a person other than a company on income by way of commission.

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