TDS Rate Chart FY 2021-22 (AY 2022-23)
Author: Editorial Team | in, Updated on: April 05, 2025 | Category:
Overview : The Financial Year 2021-22 brought a significant addition to the TDS framework with the introduction of Section 194Q (TDS on purchase of goods) effective July 1, 2021. This provision, requiring a 0.1% TDS on purchases exceeding ₹50 lakhs annually by buyers with turnover above ₹10 crore, complemented the existing TCS provision on sales while maintaining the differential rates for technical and professional services under other sections. Understanding TDS and Its Importance for Indian Taxpayers
For the Financial Year 2021-22 (Assessment Year 2022-23), understanding the applicable TDS provisions is essential for both individuals and businesses to maintain compliance with Indian tax regulations. This comprehensive guide covers all TDS rates effective from April 1, 2021, including the introduction of new provisions during the year.
Simplified TDS Rate Chart for FY 2021-22
| Section | Nature of Payment (Simplified) | Rate (%) | Threshold Limit (₹) |
|---|---|---|---|
| 192 | Slab Rate | Basic Exemption Limit | |
| 194A | Interest (Bank/Post Office/Co-op Soc) | 10% | ₹50K (Sr. Cit) / ₹40K (Others) (Annual) |
| 194A | Interest (Others) | 10% | ₹5,000 (Annual) |
| 194C | Contractor Payments | 1% (Ind/HUF), 2% (Others) | Single > ₹30K; Agg. > ₹1L (Annual) |
| 194H | Commission/Brokerage | 5% | ₹15,000 (Annual) |
| 194-I | Rent (Land/Building/Furniture) | 10% | ₹2,40,000 (Annual) |
| 194-I | Rent (Plant & Machinery) | 2% | ₹2,40,000 (Annual) |
| 194-IB | Rent by Ind/HUF (Not under Tax Audit) | 5% | ₹50,000 per month |
| 194J | Professional Fees / Director Fees etc. | 10% | ₹30,000 (Annual, excl. Director fees) |
| 194J | Technical Fees / Royalty (Sale)/ Call Centre | 2% | ₹30,000 (Annual) |
| 194M | Certain Payments by Ind/HUF | 5% | ₹50 Lakhs (Annual) |
| 194Q | Purchase of Goods (from 01-Jul-21) | 0.1% (on amount > 50L) | Agg. Purchase > ₹50L (Annual) |
Comprehensive TDS Rate Chart: FY 2021-22 (Assessment Year 2022-23)
For a detailed understanding of all applicable TDS provisions, the comprehensive chart below outlines all rates and threshold limits under various sections of the Income Tax Act, including the new provisions effective during FY 2021-22:
| Section | Nature of Payment | Rate (%) | Threshold Limit (₹) |
|---|---|---|---|
| 192 | Salary Payments | Applicable Income Tax Slab Rate | Basic Exemption Limit |
| 192A | Premature EPF Withdrawal (if service is less than 5 years) | 10% | 50,000 |
| 193 | Interest on Securities | 10% | 10,000 (General) / 5,000 (Certain Debentures) |
| 194 | Dividend (other than dividend under Section 115-O) | 10% | 5,000 (Ann.) |
| 194A | Interest (Other than Interest on Securities) | 10% | 50K (Sr.Cit-Bank)/40K (Oth-Bank)/5K (Other) |
| 194B | Winnings from Lotteries, Crossword Puzzles, Gambling etc. | 30% | 10,000 (Ann.) |
| 194BB | Winnings from Horse Races | 30% | 10,000 (Ann.) |
| 194C | Payment to Contractors / Sub-contractors | 1% (Ind/HUF Payee), 2% (Other Payees) | Single: 30,000; Annual Aggregate: 1,00,000 |
| 194D | Insurance Commission | 5% (Other Payees), 10% (Co. Payees) | 15,000 (Ann.) |
| 194DA | Payment regarding Life Insurance Policy (Not exempt u/s 10(10D)) | 5% (on income component) | Aggregate Payment during the year is 1,00,000 or more |
| 194EE | Payment regarding NSS Deposit | 10% | 2,500 (Ann.) |
| 194G | Commission, etc., on Sale of Lottery Tickets | 5% | 15,000 (Ann.) |
| 194H | Commission or Brokerage (other than Insurance Commission) | 5% | 15,000 (Ann.) |
| 194-I | Rent of Plant & Machinery | 2% | 2,40,000 (Ann.) |
| 194-I | Rent of Land, Building, Furniture or Fittings | 10% | 2,40,000 (Ann.) |
| 194-IA | Payment on Transfer of Immovable Property (other than Agricultural Land) | 1% (Con./SDV higher) | 50 Lakhs or more |
| 194-IB | Rent by Individual/HUF (not liable to tax audit) | 5% | 50,000 per month |
| 194J | Fees - Prof/Tech/Royalty/Director/Non-Compete | 2%(Tech/Call/Royalty-Film), 10%(Others) | 30,000 per cat./yr (excl. Director) |
| 194K | Income from Units of Mutual Fund/Specified Undertaking/Company | 10% | 5,000 (Ann.) |
| 194LA | Compensation on Acquisition of Immovable Property | 10% | 2,50,000 (Ann.) |
| 194LBB | Income from Investment in Securitisation Trust | 25% (Ind./HUF), 30% (Others) | No Threshold |
| 194M | Contract/Commission/Prof. Fees paid by specified Ind./HUF | 5% | 50 Lakhs (Ann.) |
| 194N | Cash Withdrawal from Bank/Post Office/Co-op Society | 2% (or 5% if ITR non-filer) | >1 Cr / >20L (if ITR is not filed) (Ann.) |
| 194-O | Payment by E-commerce Operator to Participant | 1% (Gross Amount) | 5 Lakhs (Ind/HUF Part. Ann. with PAN/Aadhaar) |
| 194P | TDS by Bank for Specified Senior Citizens (75+) | Applicable Income Tax Slab Rate | Conditions Apply |
| 194Q | TDS on Purchase of Goods by spec. Buyer (from 01-Jul-21) | 0.1% (on purchase > 50L) | Buyer T/O >10Cr & Purch ≥ 50L Ann. |
| 206C(1H) | TCS on Sale of Goods | 0.1% (on amount > 50L) | Seller T/O >10Cr & Sale ≥ 50L Ann. |
Notable TDS Provisions for FY 2021-22
- Introduction of Section 194Q: TDS on Purchase of Goods (from July 1, 2021) :The Finance Act 2021 introduced a new TDS provision through Section 194Q, effective from July 1, 2021. This section requires specified buyers (with turnover exceeding ₹10 crore in the preceding financial year) to deduct tax at the rate of 0.1% on purchases of goods exceeding ₹50 lakhs in a financial year. This provision was introduced to expand the tax collection mechanism to high-value goods transactions, complementing the existing TCS provision on the sale of goods.
- Section 194P: TDS by Specified Banks for Senior Citizens (75+ years) : FY 2021-22 saw the implementation of Section 194P, which introduced a simplified taxation regime for senior citizens aged 75 years or more. Under this provision, specified banks calculate the tax liability of eligible senior citizens (who have only pension and interest income from the same bank) and deduct appropriate TDS, eliminating their need to file income tax returns. This provision aimed to ease compliance for elderly taxpayers with simple income profiles.
- Section 194O: E-commerce Transactions : FY 2021-22 was the first full financial year of implementation for Section 194O, which requires e-commerce operators to deduct TDS at 1% on payments made to e-commerce participants. This provision, introduced in the previous financial year, aimed to bring the growing e-commerce sector within the tax net.
- Differential Rates under Section 194J : The dual-rate structure for TDS under Section 194J continued in FY 2021-22 : 2% rate or Technical services, Royalties relating to the sale, distribution or exhibition of cinematographic films & Call centre services. 10% rate for Professional Services, Director fees, & Non-compete fees. This differentiation recognised the typically lower profit margins in technical services compared to professional services, aiming to address sectoral concerns while maintaining tax compliance.
Conclusion
The financial year 2021-22 marked a significant expansion of India's TDS framework, particularly with the introduction of Section 194Q for purchases of goods. Setindiabiz offers expert compliance solutions tailored to these requirements, ensuring accurate calculations and timely compliance while protecting your business from penalties and optimising your tax position.
Disclaimer : This information is based on the Income Tax Act 1961 and incorporates changes introduced in the Finance Act 2021. While we strive for accuracy, tax laws are complex and subject to interpretation. We recommend consulting with a tax professional for advice specific to your situation.
Faq's
Author Bio
Editorial Team | in
Setindiabiz Editorial Team is a multidisciplinary collective of Chartered Accountants, Company Secretaries, and Advocates offering authoritative insights on India’s regulatory and business landscape. With decades of experience in compliance, taxation, and advisory, they empower entrepreneurs and enterprises to make informed decisions.