Complete TDS Rate Chart Guide: Rates, Thresholds, and Filing Due Dates

Introduction: The Mechanics of TDS in India

Tax Deducted at Source (TDS) is a system introduced by the Income Tax Department to collect tax at the source of income generation. Any person or business making specified payments (such as salaries, rent, professional fees, or commissions) must deduct a percentage of tax before making the payment.

Keeping track of changing TDS rates, thresholds, and filing timelines is essential for businesses to avoid late penalties and interest charges. This guide provides an updated TDS rate chart and compliance checklist.

1. Essential TDS Sections and Rates

Section 194J (Professional/Technical Fees): 10% for professional services; 2% for technical services or call center operations. Threshold: ₹30,000.

Section 194C (Contractors): 1% for payments to individuals/HUFs; 2% for other entities. Threshold: ₹30,000 for single transaction, or ₹1,00,000 aggregate annually.

Section 194I (Rent): 10% on land, building, or furniture; 2% on plant and machinery. Threshold: ₹2,40,000 annually.

2. TDS Compliance and Filing Deadlines

TDS deducted in a month must be deposited with the government by the 7th of the following month (except March deductions, due by April 30).

Quarterly TDS returns must be filed on the following dates:

• Q1 (April-June): July 31

• Q2 (July-Sept): October 31

• Q3 (Oct-Dec): January 31

• Q4 (Jan-March): May 31

Frequently Asked Questions

1. What is the penalty for late deduction or payment of TDS?

Late deduction attracts interest at 1% per month from the due date. Late payment of deducted tax attracts interest at 1.5% per month.

2. What happens if the payee does not provide their PAN?

If the payee does not provide a valid PAN card, the tax must be deducted at a flat rate of 20% under Section 206AA.

3. What is a TDS Certificate?

A document (Form 16/16A) issued by the deductor to the deductee certifying the amount of tax deducted and deposited with the government.

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Disclaimer: The information provided in this guide is for educational purposes only and does not constitute formal legal or financial advice. Please consult a qualified professional before making business decisions.