What are the TDS Rates Applicable for 2021-22

Tax deducted at source or TDS is a tax deducted on various income sources such as salary, payment, interest earned, commission, etc. Hence, it is important to keep a tab on the updated rates to streamline payment.

Keep scrolling to find detailed information on the TDS rates for the financial year 2021-22.

TDS Rates for FY 2021-22

The Economic Times reported a hike in the TDS and TCS rates on non-salary payments, effective from 1st April 2021.

For instance, if interest paid on a fixed deposit exceeds ₹40,000 between 1st April 2021 and 31st March 2022, then the lender will now deduct tax on the interest repaid at 10%. Previously this rate was 7.5% in FY 2020-21.

The due date to file TDS returns for Q4 of the FY 2020-21 is extended to 15th July 2021.

Here is a table showing the TDS rate 2021-22.

Nature of Payment and Section	Threshold	Individual/ HUF TDS Rate
Premature withdrawal from EPF, 192A	₹50000	10% (20% if no PAN card)
Salaries,192	As per the employee’s IT declaration	10%
Dividends,194	₹5000	10%
Interest on securities,193	₹2,500	As per slab rates
Interest from banks,194A	₹40000	10%
Senior citizen,194A	₹50000	10%
Single contractor payment,194C	₹30000	1%
Aggregate contractor payment, 194C	₹1 lakh	15%
Insurance commission (15G and 15H allowed), 194D	₹15000	5%
Life insurance policy, 194DA	₹1 lakh	1%
NSS,194EE	₹2500	10%
Repurchase units by MFs, 194F	-	20%
Commission from lottery,194G	₹15000	5%
Brokerage,194H	₹15000	5%
Rent of plant, machinery or equipment, 194I(a)	₹2.40 lakh	2%
Rent of building, land and furniture, 194I(b)	₹2.40 lakh	10%
Transfer of immovable property besides agricultural land, 194IA	₹50 Lakh	1%
Rent by Individual / HUF (w.e.f. 1st June 2017), 194IB	₹50000 per month	5%
Payment under agreement applicable from FY 2017-18, 194IC	-	10%
Fees-tech services, call centre, etc., 194J (a)	₹30000	2%
Fee for royalty or professional service, 194J (b)	₹30000	10%
Compensation on the transfer of immovable property other than agricultural land, 194LA	₹2.50Lakh	10%
Payment of dividends by mutual funds, 194K	₹5000	10%
Infrastructure debt fund income (TDS rate for NRI), 194LB	-	5%
Interest on specific bonds and Government Securities, 194LD	-	5%
Cash withdrawal in previous year from one or more accounts with a lending institution, 194N	₹1 crore	2%
An individual or HUF payment to commission or brokerage, 194M	₹50 Lakh	5%
Purchase of goods, 194Q	₹50 Lakh	0.10%
TDS on e-commerce, 1940	₹5 Lakh	1%

Technically, the concept of TDS was introduced to collect tax from the very source of income. This obligates a deductor, liable to make payment to a deductee, make tax deduction at source and forward the same into the central government’s account.

Hence, apart from the mentioned TDS rates in the table, the government has set specific rates for Indian entities other than a company.

TDS Rates Applicable for Residents of India (Other Than a Company)

Here is a table showing the TDS rate chart for Indian residents.

Nature of Payment	Section	TDS Rate
Payment of salary	192	10%
Interest on securities	193	10%
Income in the form of interest	194A	10%
Payment of any dividend	194	10%
Income from a lottery and other games	194B	30%
Payment to the contractor - HUF/Individual	194C	1%
Payment to the contractor - Others	194C	2%
Income from horse race winnings	194BB	30%
Payment of any sum towards a life insurance policy	194DA	5%
Insurance commission	194D	5%
Payment due to repurchase of a unit by Unit Trust of India (UTI) or a mutual fund	194F	20%
Payment under National Savings Scheme	194EE	5%
Commission payments	194G	5%
Rent on Plant/machinery	194-I	2%
Rent on land, furniture, building or fitting	194-I	10%
Brokerage	194H	5%
Payment under a joint development agreement	194-IC	10%
Payment made on transfer of certain immovable property other than agricultural land	194-IA	1%
Rent payment by an HUF or individual	194-IB	5%
Fee for professional services, commission to a director and not carrying out any activity regarding the business	194J	10%
Not sharing any patent for technical services and sale or distribution.	194J	2%
Income distributed by a business trust to its unitholder	194LBA(1)	10%
Payment on certain immovable property	194LA	10%
Payment of any income on units of a mutual fund	194K	10%
Income from investment in securitisation fund for individuals/HUF	194LBC	25%
Payments by Individual/HUF with a limit of ₹50 lakhs	194M	5%
Withdrawal exceeding amount limit ₹1 crore	194N	2%
Payments on purchase of goods with the aggregate value of goods exceeding ₹50 lakhs	194Q	0.1%
Tax deduction by lending institutions while making payments	194P	Tax on total income
Sale of goods by e-commerce platforms	194O	1%
Other Income	-	10%

Now let’s check the TDS rate for non-resident as of the financial year 2021-22.

TDS Rates Applicable for Non-Resident Indians (Other Than a Company)

Here is a table showing the TDS rates for NRI’s under different sections.

Nature of Payment	Section	TDS Rate
Payment of salary	192	10%
Commission	194G	5%
Premature withdrawal from EPF	192A	10%
Income from lottery winnings	194B	30%
Income from horse racing	194BB	30%
Payment from repurchasing a unit by Unit Trust of India	194F	20%
Payment to non-resident sportsman	194E	20%
Payment on compensation on immovable property	194LB	5%
Payment to a person under National Savings Scheme (NSS)	194EE	10%
Interest receivable to a business	194LBA(2)	5%
Dividend received from SPV by a business trust	194LBA(2	10%
Income from an investment fund to a unit holder	194LB	30%
Rental income, or income from real estate assets owned by business trust	194LBA(3)	30%
Interest for the loan borrowed in foreign currency by an Indian company	194LC	5%
Interest payable against long term bonds listed in IFSC)	194LC	4%
Income from investment in securitisation fund	194LBC	30%
Payment of interest on the bond to foreign Investor	194LD	5%
Income from units of an offshore fund	196B	10%
Income from foreign currency bonds or GDR of an Indian company	196C	10%
Any income through LTCG	195	15%
Payment of any other sum to NRI by way of - LTCG under section 112A, STCG under section 111A, LTCG under section 112(1)(c)(iii), Royalty payable to the Indian government for agreement on industrial policy, Technical fees to the Indian government related to industrial policy.	195	10%
Payment of any other sum to NRI by way of - Investment made by NRI, LTCG referred to in section 115E, Interest payable on sum borrowed by the Indian government in foreign currency, Royalty payable to the Indian concern by government or Indian concern in pursuance of an agreement on matters related to industrial policy Income from royalty payable to or by the Indian government for the copyright referred in section 115A.	195	20%
Any other income related to NRI	195	30%

Apart from Indian and non-Indian residents, the companies are obligated to pay a certain amount of TDS. Therefore, we have segregated the TDS rate for firms according to domestic and non-domestic categories.

TDS Rates Applicable for Domestic Companies

Here is a table enlisting the TDS rates for domestic companies.

Nature of Payment	Section	TDS Rate for Company (Domestic)
Premature withdrawal from EPF	192	10%
Interest on securities	193	10%
Income in the form of interest	194A	10%
Payment of any dividend	194	10%
Payment to contractor or sub-contractor- Individuals/HUF	194C	1%
Payment to contractor or sub-contractor- Others	194C	2%
Income by way of lottery winningsn	194B	30%
Income from horse race winnings	194BB	30%
Payment in respect of a life insurance policy	194DA	5%
Insurance commission	194D	10%
Payment from repurchase of a unit by UTI or a mutual fund	194F	20%
Brokerage	194H	5%
Payment to a person under National Savings Scheme (NSS)	194EE	10%
Payments like commission on the lottery ticket sale	194G	5%
Rent on plant and machinery	194-I	2%
Rent on land, building, furniture or fitting	194-I	10%
Fee from commission to a director, professional services and lack of business activity	194J	10%
Payment to HUF or individual	194-IC	10%
Payment on transferring immovable property other than agricultural land	194-IA	1%
Payments to residents for purchasing goods when the aggregate value of goods exceeds ₹50 lakhs	194Q	0.1%
Payment of income against mutual funds as per section 10(23D)	194K	10%
Income paid against investment fund to a unit holder	194LBB	10%
Payment on the attainment of certain immovable property	194LA	10%
Cash withdrawal	194N	2%
Income distributed by a business trust to its unit holder	194LBA(1)	10%
Income from investment in securitisation fund	194LBC	10%
Payments by Individual/HUF where the limit is ₹50 Lakhs	194M	5%

TDS Rates for Non-domestic Companies

Here is a table explaining the TDS rate for private limited companies which are non-domestic.

Nature of Payment	Section	TDS Rate
Income by way of lottery winnings	194B	30%
Income from horse race winnings	194BB	30%
Payment to non-resident sportsman	194E	20%
Payments such as commission	194G	5%
Payment in on the purchase of an immovable property	194LB	5%
Interest receivable to a business	194LBA(2)	5%
Dividend received from SPV by a business trust	194LBA(2)	10%
Rental income, or income from real estate assets owned by business trust	194LBA(3)	40%
Income from an investment fund to a unit holder	194LBB	40%
Income from investment in securitisation fund	194LBC	40%
Interest on a loan borrowed by an Indian company in foreign currency	194LC	5%
Interest payable against long term bonds listed in IFSC	194LC	4%
Payment of interest on the bond to foreign investors	194LD	5%
Income (inclusive of LTCG) from foreign currency bonds	196C	10%
Income (including LTCG) from units of an offshore fund.	196B	10%

Refer to the following table for TDS rates on Pvt. Ltd. companies under Section 195.

Nature of Payment	Section	TDS Rate
Income by way of STCG under section 111A	195	15%
Earnings from royalty payable to the Indian concern by government or Indian concern in pursuance of an agreement on matters related to industrial policy	195	50%
Income arising out of long-term capital gains as per the recommendations of Section 112A	195	20%
Payment of any other amount to a Non-resident company from income arising from any other source	195	40%
Payment from- Any other sum such as-Income by way of LTCG under section 112(1)(c)(iii), Income earned in terms of fees which is payable by the government or an Indian organisation for technical services, Income arising out of royalty which is payable by the government or an Indian organisation subject to certain conditions.	195	10%
Income by way of STCG under section 111A	195	15%

Following these tables will help you understand the differences in TDS rates for specific individuals and companies.

Since the calculation is quite complicated, we suggest using online TDS calculators to streamline the entire process.

Frequently Asked Questions

All

What are the TDS rates applicable on interest on securities?

The TDS rate applicable on interest on securities is 10%.

Are new TDS rates applicable on non-salary payments in 2021?

Yes, new TDS rates will be applicable on non-salary payments in FY 2021-22.