TDS Service

Tax Deducted at Source (TDS) is a means of collecting income tax in India, under the Indian Income Tax Act of 1961. Any payment covered under these provisions shall be paid after deducting prescribed percentage. It is managed by the Central Board for Direct Taxes (CBDT) and is part of the Department of Revenue managed by Indian Revenue Service (IRS). It has a great importance while conducting tax audits. Assessee is also required to file quarterly return to CBDT. Returns states the TDS deducted & paid to government during the Quarter to which it relates. The present Commissioner of Income Tax (TDS) is Dr. Sibichen K Mathew I.R.S.

TDS on Dividends

Section 194 of Income Tax Act, 1961 by lawnotes.[1]

  • TDS provisions under this section are attracted only in respect of deemed dividend u/s 2(22)(e), If such dividend exceeds 2500 in year.
  • Rate of deduction of tax in respect of such dividend is 10%.
  • Provisions will not apply to dividend receivable by LIC, GIC(General Insurance Corporation), its subsidiaries or any other insurer provided shares are owned by

TDS on immovable property

Section 194I of Income Tax Act by Freakans.[2][3]

  • This provision is applicable in respect of transactions effected on or after June 1, 2013.
  • It seeks deduction of tax at source on transfer of certain immovable property other than agricultural land
  • Any person being a transferee who is liable to Pay to a resident by way of consideration for transfer of any immovable property exceeding 50 Lakhs shall at the time of credit of such sum to the account of the transferor or at the time of payment in whatever manner, has to deduct tax at source at 1% only

This TDS is required TDS on property is required to be deposited in 30 days from the end of the month in which deduction is made for all payments to be made on or after 01st June 2016. Before 01.06.2016 time limit to depoist TDS on property is 7 days from the end of the month in which deduction is made[4]

Section 194C of Income Tax Act [5]

Section 194C of Income Tax Act - Tax need to be deducted 1% (for individual, HUF)/ 2% (for others) of payment where payment is made for carrying out any work (including supply of labour for carrying out any work and advertisements) by a contractor/sub-contractor. Such work must be in pursuance of a contract (including sub contract) between the contractor and payer. TDS is to be made at the time of credit to the account of contractor or at the time of payment in cash or by cheque or draft or by any other mode whichever is earlier.