What is TDS and its sections?

The concept of TDS was introduced with an aim to collect tax from the very source of income. As per this concept, a person (deductor) who is liable to make payment of specified nature to any other person (deductee) shall deduct tax at source and remit the same into the account of the Central Government.

What is the current TDS slab?

Slabs for Deduction from Employees-

Income Tax Rate
Upto `2,50,000 Nil.
`2,50,001 to `5,00,000 5%
`5,00,001 to `10,00,000 `12,500 + 20% of Income exceeding `500,000.
Above `10,00,000 `1,12,500 + 30% of Income exceeding of `10,00,000.

What is Section 194Q in TDS?

Tax is deductible under section 194Q with effect from July 1, 2021. Tax is deductible by buyer at the rate of 0.1 per cent of the amount paid or payable exceeding Rs. 50 lakh. (i) If the recipient does not furnish his PAN to the deductor, tax will be deducted at the rate of 5 per cent by virtue of section 206AA.

What is TDS and its limit?

Section 194 – TDS on deemed dividend: There is a 10% TDS deduction rate on income from dividend if the limit of Rs. 5,000 is crossed. Section 194EE – TDS on withdrawal of National Savings Scheme: There is a 20% TDS deduction on any withdrawal from the NSS if the limit exceeds RS. 2500.

How many types of TDS is there?

two types

TDS Certificates are of two types: Form 16 and Form 16A. Under Section 203 of the Income Tax Act, 1961, a certificate must be provided to the deductee showing the amount that has been subtracted as tax. The deductor is liable to provide this form to the deductee.

What is TDS cut salary?

Rate of TDS Deduction
The TDS to be deducted by dividing the estimated tax liability of the employee for the financial year by the number of months of his employment under the particular employer. However, if there is no PAN of employee, TDS shall be deducted at the rate of 20% plus 4% cess.


What is Section 194C? Section 194C states that any person responsible for paying any sum to the resident contractor for carrying out any work (including the supply of labor), in pursuance of a contract between the contractor and the following: The Central Government or any State Government.

What is the limit to deduct TDS US 194C?

If the person does not quote his/ her PAN number to the deductor then the deductor must deduct TDS at a rate of 20%

TDS rate on Payment to Contractors Under Section 194C.

Type of Contractor/ Subcontractor Rate of TDS
Any person other than an individual or a HUF 2%

What is new TDS rules?

The government specified the new TDS section 194R in the income tax act in the Budget 2022-23. The amended section specified that a 10% TDS shall be deducted by any individual issuing any advantage or perquisite more than Rs 20,000 a year to a resident.

What is 26Q and 27Q?

TDS Form 27Q Statement from Extra Income to NRI (Foreigners)
Form 27Q is submitted by the deductor every quarter and is relevant for TDS u/s 200(3) of the Income Tax Act of 1961. Form 26Q is used for TDS on additional income such as interest, bonus or any other sum owed to NRI or foreigners.

What is 24Q and 26Q in TDS?

Form 24Q should be filed and submitted for Return of Tax Deducted at Source on salary payments. Form 26Q, on the other hand, should be filed and furnished for Return of Tax Deducted at Source details on domestic payments other than salary.

How is TDS calculated?

It will be computed as follows: Average Income tax rate = Income tax payable (calculated through slab rates) divided by employee’s estimated income for the financial year.
Understanding TDS On Salary with Example.

Total income Rs.12,00,000
Income chargeable to tax Rs.11,00,000

Is TDS refundable on salary?

Yes, if you have paid the excessive tax, it will be refunded. To get your additional tax refund, you will have to first file ITR, following which your return will be processed. If you pay any excessive tax, the government will refund it back to your bank account via ECS.

What is the limit for 194J?

Under Section 194J, Rs. 30,000 is the maximum limit which is applicable to each item or payment independently. TDS under this section is also applicable on commission or remuneration or fees given to a company’s director, even though the amount is not a part of the main salary.

What is form 16A?

Form 16/ 16A is the certificate of deduction of tax at source and issued on deduction of tax by the employer on behalf of the employees. These certificates provide details of TDS / TCS for various transactions between deductor and deductee. It is mandatory to issue these certificates to Tax Payers.

How do I file a 194Q return?

  1. Set Up Your Books for TDS.
  2. Purchase of Goods u/s 194Q.
  3. Specified Person u/s 206AB.
  4. Record TDS Transactions.
  5. Generate TDS Reports.
  6. Form 26Q.
  7. Form 27Q.
  8. Validate & File TDS Returns.

Who filed 26Q?

A taxpayer pays taxes on every kind of income. When an income which is not the salary, is received by the payee, form 26Q is used to file the TDS returns. Form 26Q is used to mention the amount of income and the TDS deducted on that income.

What is 27a form?

Form for furnishing information with the statement of deduction/collection of tax at source (tick whichever is applicable) filed.

Is TDS applicable on 30000 salary?

TDS is required to be deducted under Section 194J if the payment towards professional or technical services covered under this section exceeds Rs 30,000 per annum.

What is 16B Form?

Traces facilitates the buyer of immovable property to download Form 16B after registering on TRACES as taxpayer. The buyer of the property would be required to issue Form 16B to the Seller of the property in respect of the TDS deducted and deposited with the government.​ User can register on the basis of “PAN”

How do you calculate 50 lakhs to 194Q?

2) When buyer purchase any goods of value or aggregate of value > 50 Lakhs in the previous year. 3) Buyer deducts @0.10% at the time of credit of such sum to the account of the seller or at time of payment whichever is earlier on such amount exceeding 50 lakhs.

What is 26AS and 26Q?

Form 26Q is used to file TDS details on payments made other than salary. The form mentions the total amount that is paid during the quarter and the TDS amount that has been deducted. Form 26Q has to be submitted on a quarterly basis.

What is form 27a?

Form for furnishing information with the statement of deduction/collection of tax at source (tick whichever is applicable) filed. on computer media for the period (From.

What is form 24Q and 26Q?

How do I file 26Q?

How to download the form 26Q?

  1. Click on the downloads tab and from the menu choose E-TDS/E-TCS.
  2. On this page, click on ‘quarterly returns’ and then select ‘regular’.
  3. Once you do that you will be transferred to a new web page.
  4. This page will contain a section ‘form’ under which there will be form 26Q. Click on that.