Persons Liable to Deduct Tax at Source (TDS) for A.Y.2015-16

TDS is treated as pre-paid taxes as it is paid in advance to the government. It is the duty of the person who paid to someone for his service, goods etc. These payments are specified by the act like salary payment, interest on securities, contract payment, dividends etc. Who deduct TDS of payee is called deductor and whose tax is deducted called deductee. The following persons are liable to deduct TDS and deposit to government on behalf of deductee.

Income Tax Act require specified persons to deduct tax on particular types of payments being made by them. The list of such persons requiring to make TDS is contained in TDS provision listed here. The following are the specified person who are liable to deduct TDS.

An Individuals or an H.U.F. is not liable to deduct TDS on such payment except where the individual or H.U.F. is carrying on a business/profession where accounts are required to be audited u/s 44AB, in the immediately preceding financial year.

A person is liable to get its accounts audited u/s 44AB if during the relevant financial year its gross sales, turnover or gross receipts exceeds Rs. 1 Crore (A.Y. 2015-16) (Rs.60 lacs for A.Y.2012-13) in case of a business, or Rs. 25 lacs (A.Y.2015-16) (Rs. 15 lacs for A.Y. 2012-2013) in case of a profession.

Persons who are liable to deduct TDS as per above stated conditions must apply for allotment of ‘TAX DEDUCTION AND COLLECTION ACCOUNT NUMBER’ (TAN) in form No. 49B within one month from the end of the month in which tax was deducted. TAN is mandatory to mention on all transaction related to TDS like TDS certificate, TDS Returns and other related documents. There is penalty of Rs. 10,000 on failure to apply TAN.

There are also some conditions where is no liability of deductor to deduct TDS as follows.

  • On declaration furnished by payee on Form 15G or 15H as the case may be
  • On certificate issued by ITO
  • Payment to Government/RBI/Statutory Corporation etc.
  • Exempt Incomes
  • Interest Payment by Offshore Banking Unites
  • Payment to New Pension System Trust
  • Notified payment to Notified Institutions/Associations

35 Comments

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  1. Your grammar is very poor. Please improve it

    1. You are able to get a lot of info for free, isn’t it ? So, don’t worry about his grammar. Just say thanks for the info. For most of us, English is not our mother tongue, so, grammar mistakes ? Chalta hain 🙂 not a big deal, not a big deal at all.

      1. thanks a lot for these info. great web site.

      2. I have received an invoice from Trust and the service fee is for towards presentation fee for participating at six sigma level competition; will the TDS be deducted u/s 194J.

  2. Simply Superb,,,,,,,,,,,Thank You Soomuch

  3. Thanks Great Information Please Carry on your work is praise worthy

  4. I am individual , my income is from professional software consulting . I do not own any registered business and i do my work through freelance sites like Elance etc .

    I pay a couple of persons who are working for me . My annual income would be close to 5 to 7 lakhs .

    I pay the persons who are working with me , which would be around 4 lakhs .

    Should i deduct TDS for them ? Should i get a TAN no?

    Is deducting TDS in my case mandatory ?

    Thanks in advance..!!!

  5. I think you should not deduct the TDS. Individuals are liable when their accounts are audited u/s 44AB

    1. I am Individual Having Business, My turnover FY 2013-14 Is Rs.48 lacs and net loss is 9 lac and others income is Rs.90 thousand only.Is TAX AUdit by CA is Necessary & If I get TAX Audit Done,Am I applicable for TDS Registration or Deduction in the Next FY 2014-15 ???????

      1. Tax Audit is not compulsary in this case. Because your business Turnover is less than Rs. One Crore

  6. sale of scrape it is an income to us, & it is chargeable tax on income……..?

  7. SALE OF SCRAPE IS IT INCOME ………………? & IT IS CHARGEABLE TAX ON INCOME OF SALE OF SCRAP………..

    THANKS IN ADVANCE…………….!!!

    1. Yes, Income from sale of scrap is taxable under Income Tax

  8. What’s rate of TDS on Courier payment in year Rs. 2 to 3 lacs p.a. or below 1.00 p.a. pl suggest

  9. I am an independent professional. For AY 2014-15, I will probably invoice Rs.20 lac worth of services. I use different partners to help me. I will end up paying one partner approximately Rs. 7 lacs and another one Rs. 1 lac. Is the TAN requirement solely based on my income? Or will IT dept consider the payments made to contract partners also? I generally work alone and do not outsource regularly. Is there a way to get official waive off for getting a TAN as an individual professionals?

  10. I am consulting physio in hospitals as per only call basis. .they give me 20000 rupees for the 3 years…Should they deduct TDS from me ?

  11. ABHIRAM ENTERPRISE PRIVATE LTD

    our business will be less than Rs 1.00Crore during the FY 2015-16, can we liable to deduct tds
    asish

  12. Any employees are liable for deduction of TDS from their salary

  13. On 12.02.2015 payment of Rs.220000 made to Arvind for purchase of diaries made according to specifications of ABC Ltd.However no material was supplied for such diaries to Arvind by ABCLtd.
    pls i need the answer for this question.

    1. Sorry Reshma..ok then what is your question about the situation??

  14. I wish to open a research centre. I may get funds from interested donors. Should I get a TAN and TIN Nos for that?
    If I get TAN and TIN and not use it, what will be the consequences?

    1. Sir, If you are getting refund, you don’t need to get TAN. Its only require when you make payment to someone and its added his/her income. So you have to deduct TDS on that. So here you are receiving funds so you don’t need to deduct TDS of anyone.

  15. Is individual liable to deduct tds on land purchase from resident u/s 194-IA &195 from NR for an amount exceeding Rs.50lakhs.
    1.For Personal use-only salary income
    2.For Commercial purpose but not liable for Tax Audit.
    Can we say liability of individual to deduct tds is only if he is liable for Tax audit in all cases/not.

  16. My turnover is 2 crore. How to apply for TAN.

  17. i am individual do i need to deduct tds on commission paid by me .i am not in any proffesion. i am one of the partner in partnership bussiness . but this commission is paid on my personal property given on rent . and the commission paid by me to person who bring the party as tenent . it is commercial property and not for residential purpose

  18. Can you please specify the Notification / Circular / Rule exempting small employers (individuals / HUF etc. not subject to tax audit) from deducting tax at source.

  19. Can colleges deduct TDS?

  20. Sir,

    My name is Sachin,

    We are Fix Diposited Rs. 200000.00 a Credit Co-opp.Society.
    then he told him to Tax Deducted in Intrest Amt.at the maturity time.
    My Income is more than taxable limit.so we do not given 15G.

    so please give me information about of TDS.
    My knowledge is only Bank ( co-opp bank) are liable to Deduct TDS.
    So Please give me suggetion….

  21. ashutosh pandey

    what is the slab for TDS in AY 2016-17 and on which amount of turnover, receipt TDS is deductable?

  22. thanks a lot

  23. I am getting 10k as contract fee per month from pvt limited for technical service. Will tds will be deducted if i submit 15g

  24. RAVI KANTH CHAURASIYA

    THANKS A LOT FOR TDS GUIDANCE……..

  25. What are the Exemted sales and in which conditions we need not to deduct tds.

  26. TDS is applicabale to AOP??

  27. If I am a Branch, and my H.O. is making payment to someone on my behalf, then who will be liable to deduct and deposit TDS (whether Branch or H.O.)? Kindly clarify.

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