The TDS full form is Tax Deducted at Source. The government collects taxes from its citizens in different ways. TDS (TDS full form) is also a way of collecting taxes. Many Types of sections are charged to collect tax in the form of TDS which varies based on the work done by the company, and firms.
The deductor, from whom income tax has been deducted at source, shall be entitled to credit the amount deducted based on Form 26AS or TDS certificate issued by the deductor.
For example, (TDS full form)
If a shirt-making company gets its shirt made by a fabricator, then under section 94C, the company making the shirt has to deposit TDS, which it will collect from the payment of fabrication. If the manufacturing company is a partnership Firm, then 2% TDS will be charged there is a provision to deposit 1% TDS if the proprietorship is a firm. The Firm doing the fabrication gets the TDS claim while filing the income tax return.
TDS Rate Chart for F.Y. 2021-22 (A.Y: 2022-23)
| Section | Nature of payment | Threshold Limit Rs. | Applicable from 01/04/2021 to 31/03/2022 | |
| Resident | Non-resident * | |||
| Rs. | TDS Rate (%) | TDS Rate (%) | ||
| 192 | Salaries | – | Normal slab rate | Normal slab rate |
| 192A | Premature withdrawal from EPF | 50000 | 10 | 10 |
| 193 | Interest on securities – 8% Savings (Taxable) Bonds, 2003 or 7.75% Savings (Taxable) Bonds, 2018 during the financial year | 10000 | 10 | – |
| 193 | Interest on securities – Interest on securities for money issued by or on behalf of any local authority/statutory corporation, listed debentures of a company (other than demat form), any other interest on securities | 5000 | 10 | – |
| 194 | Dividends | 5000 | 10 | – |
| 194A | Interest (Banking co., co-operative society engaged in banking, post office) | 40000 | 10 | – |
| 194A | Interest (Any other person) | 5000 | 10 | – |
| 194B | Winning from lotteries | 10000 | 30 | 30 |
| 194BB | Winning from Horse race | 10000 | 30 | 30 |
| 194C | Contractor-Single Transaction-Individual/HUF -Others | 30000 | 1 2 | – – |
| 194C | Contractor – Consolidated Payment During the F.Y – Individual/HUF – Others | 100000 | 1 2 | – – |
| 194D | Insurance commission – Other than Company – Company | 15000 | 5 10 | – – |
| 194DA | Maturity of Life insurance policy | 100000 | 5 | – |
| 194E | Non-resident sportsmen or sports association | – | – | 20 |
| 194EE | NSS | 2500 | 10 | 10 |
| 194F | Repurchase units by MFs | – | 20 | 20 |
| 194G | Commission-Lottery | 15000 | 5 | 5 |
| 194H | Commission/Brokerage | 15000 | 5 | – |
| 194I | Rent of – Plant/Machinery /Equipment – Land and Building/Furniture & Fixture | 240000 | 2 10 | – – |
| 194IA | Transfer of certain immovable property other than agriculture land | 50 lakhs | 1 | – |
| 194IB | Rent by Individual/HUF | 50000 per month | 5 | – |
| 194IC | Payment under Joint Development Agreements to Individual/HUF | – | 10 | – |
| 194J | Professional Fees | 30000 | 10 | – |
| 194J | Technical Fees (w.e.f. 01.04.2020) | 30000 | 2 | – |
| 194J | Payment to call centre operator (w.e.f. 01.06.2017) | 30000 | 2 | – |
| 194J | Director’s fees | – | 10 | – |
| 194K | Payment of any income in respect of (a) units of a mutual fund as per section 10(23D); or (b) the units from the administrator; or (c) units from specified company (w.e.f. 01.04.2020) | 5000 | 10 | – |
| 194LA | Compensation on transfer of certain immovable property other than agriculture land (TDS exempted if covered under RFCTLARR Act w.e.f. 01.04.2017) | 250000 | 10 | – |
| 194LB | Income by way of interest from infrastructure debt fund | – | – | 5 |
| 194LBA | Income from units of business trust -interest received or receivable from a special purpose vehicle; or – dividend referred to in sub-section (7) of section 115-O | – | 10 10 | 5 10 |
| 194LBA | Distribution of rental income to unit holders – Other than Company – Company | – | 10 10 | 30 40 |
| 194LBB | Income in respect of units of investment fund – Other than Company – Company | – | 10 10 | 30 40 |
| 194LBC | Income in respect of investment in securitization fund – Individual/HUF – Company – Other Person | – | 25 30 30 | 30 40 30 |
| 194LC | Income by way of interest by an Indian specified company to a non-resident/foreign company on foreign currency approved loan / long-term infrastructure bonds from outside India | – | – | 5 |
| 194LC | Income by way of interest by an Indian specified company on rupee denominated bond / any long-term bonds from outside India, which is listed only on a recognized stock exchange located in any International Financial Services Centre | – | – | 4 |
| 194LD | Interest on certain bonds from Govt. securities | – | – | 5 |
| 194M | Certain payments by Individual/HUF | 50 lakh | 5 | – |
| 194N | Payment of certain amount in cash | 1 Crore | 2 | 2 |
| 194N | Payment of certain amount in cash (first proviso of section 194N) if- – Amount is more than Rs.20 lakh but up to Rs. 1 crore – Amount exceeds Rs. 1 crore | 2 5 | 2 5 | |
| 194-O | Applicable for e-commerce operator for the sale of goods or provision of services facilitated by it through its digital or electronic facility or platform (w.e.f. 01.04.2020) | – | 1 | – |
| 194-P | Deduction of tax in case of specified senior citizen. [Change will applicable from 1st April, 2021.] | – | Applicable rates in force | – |
| 194-Q | Payment of certain sum by the buyer to the seller (resident Indian) for purchase of goods [Change will applicable from 1st July, 2021.] | 50 lakhs | 0.1 | – |
| 195 | Income of Investment made by an NRI | – | – | 20 |
| 195 | Long-term capital gain – Under Section – 115E/112(1)(c)(iii)/112A – Any Other Gains | – | – – | 10 20 |
| 195 | Short-term capital gain – 111A | – | – | 15 |
| 195 | Royalty | – | – | 10 |
| 195 | Fees for technical services | – | – | 10 |
| 195 | Interest income payable by Govt./Indian concern (other than section 194LB or 194LC) | – | – | 20 |
| 195 | Any Other Income – Other than Company – Company | – | – – | 30 40 |
| 196A | Income in respect – – of units of a Mutual Fund specified under clause (23D) of section 10; or – from the specified company referred to in the Explanation to clause (35) of section 10 | – | – | 20 |
| 196B | Income from units to an offshore fund | – | – | 10 |
| 196C | Income from foreign currency bonds or GDR of an Indian company | – | – | 10 |
| 196D | Income of foreign Institutional Investors from securities (not being dividend or capital gain) | – | – | 20 |