Posted by & filed under Income Tax 2016.

Under the scheme of deduction of tax at source as provided in the Act, every person responsible for payment of any specified sum to any person is required to deduct tax at source at the prescribed rate and deposit it with the Central Government within specified time. However, no deduction is required to be made if the payments do not exceed prescribed threshold limit.

In order to rationalise the rates and base for TDS provisions, the existing threshold limit for deduction of tax at source and the rates of deduction of tax at source are proposed to be revised as mentioned in table 3 and table 4 respectively.

Table 3: Increase in threshold limit of deduction of tax at source on various payments mentioned in the relevant sections of the Act –  

Section 192A is referred by the EPF dept while calculating the tax at the time of EPF withdrawal in regards to such employee who have not having Pan card & not submitted form No 15-G  also there are some state where in minimum wages are low & the contribution is deducted & the amount of  is less then 50000 where in service is less then 2 years or three years  it is good news for EPF subscriber 

Present Section Heads Existing Threshold
Limit (Rs.)
Proposed Threshold Limit
(Rs.)
192A Payment of accumulated balance due to an employee 30,000 50,000
194BB Winnings from Horse Race 5,000 10,000
194C Payments to Contractors Aggregate annual limit of 75,000 Aggregate annual limit of 1,00,000
194LA Payment of Compensation on acquisition of certain Immovable Property 2,00,000 2,50,000
194D Insurance commission 20,000 15,000
194G Commission on sale of lottery tickets 1,000 15,000
194H Commission or brokerage 5,000 15,000
Table-4 : Revision in rates of deduction of tax at source on various payments mentioned in the relevant sections of the Act:
Present Section Heads Existing Rate
of TDS (%)
Proposed Rate of
TDS (%)
194DA Payment in respect of Life Insurance Policy 2% 1%
194EE Payments in respect of NSS Deposits 20% 10%
194D Insurance commission Rate in force (10%) 5%
194G Commission on sale of lottery tickets 10% 5%
194H Commission or brokerage 10% 5%
The following provisions which are not in operation are proposed to be omitted as detailed in Table 5.
Table 5: Certain non-operational provisions to be omitted
Present Section Heads Proposal
194K Income in respect of Units To be omitted w.e.f 01 .06.2016
194L Payment of Compensation on acquisition of Capital Asset To be omitted w.e.f 01 .06.2016
These amendments will take effect from 1st June, 2016.

@courtesy http://taxguru.in/income-tax/

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