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LOWER RATE OF TDS

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LOWER RATE OF TDS

LOWER RATE OF TDS

    1. Section 197 of Income Tax Act, 1961 – Certificate for deduction at lower rate in case of Residents.

    As per Income Tax Act, 1961 a Receiver of taxable Payment can seek an application in form 13 for Lower or Nil rate of TDS deduction. In Such cases where the assessing officer has issued a certificate, TDS shall be deducted at the rates mentioned in certificate.

    • Subject to rules made under sub-section (3), where, in the case of any income of any person or sum payable to any person, income-tax is required to be deducted at the time of credit or, as the case may be, at the time of payment at the rates in force under the provisions of sections 192, 193, 194, 194A, 194C, 194D, 194G, 194H, 194I, 194J, 194K, 194LA, 194LBB, 194LBC, 194Mand 195, the Assessing Officer is satisfied that the total income of the recipient justifies the deduction of income-tax at any lower rates or no deduction of income-tax, as the case may be, the Assessing Officer shall, on an application made by the assesse in this behalf, give to him such certificate as may be appropriate.
    • Where any such certificate is given, the person responsible for paying the income shall, until such certificate is cancelled by the Assessing Officer, deduct income-tax at the rates specified in such certificate or deduct no tax, as the case may be.
    • The Board may, having regard to the convenience of assesses and the interests of revenue, by notification in the Official Gazette, make rules specifying the cases in which, and the circumstances under which, an application may be made for the grant of a certificate under sub-section (1) and the conditions subject to which such certificate may be granted and providing for all other matters connected therewith.

     

    1. Section 195 of Income Tax Act, 1961 – Certificate for deduction at lower rate in case of Non Residents.
    2. As per section 195(2),where the person responsible for paying any such sum chargeable under this Act (other than salary) to a non-resident considers that the whole of such sum would not be income chargeable in the case of the recipient, he may make an application [in such form and manner to the Assessing Officer, to determine in such manner, as may be prescribed], the appropriate proportion of such sum so chargeable, and upon such determination, tax shall be deducted under sub-section (1) only on that proportion of the sum which is so chargeable.
    1. As per section 195(3), any person entitled to receive any interest or other sum on which income-tax has to be deducted under sub-section (1) may make an application in the prescribed form to the Assessing Officer for the grant of a certificate authorising him to receive such interest or other sum without deduction of tax under that sub-section.
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