Rationalization of TDS Rates and New Sections in Union Budget 2024
The latest Union Budget in 2024 brings significant changes to Tax Deducted at Source (TDS) rates and introduces new TDS sections. Let’s dive into the key updates:
1. Section 194D – Insurance Commission Payment
Existing: TDS rate for insurance commission is 5%
Proposed: Rate to be reduced to 2% from 01.04.2025
2. Section 194DA – Life Insurance Policy Payment
Existing: TDS rate for life insurance policies is 5%
Proposed: Rate to be reduced to 2% from 01.10.2024
3. Section 194G – Lottery Tickets Commission
Existing: TDS rate for commission on lottery tickets is 5%
Proposed: Rate to be reduced to 2% from 01.10.2024
4. Section 194H – Commission or Brokerage Payment
Existing: TDS rate for commission or brokerage is 5%
Proposed: Rate to be reduced to 2% from 01.10.2024
5. Section 194IB – Rent Payment by Individuals
Existing: TDS rate for rent payments is 5%
Proposed: Rate to be reduced to 2% from 01.10.2024
6. Section 194O – E-Commerce Transactions
Existing: TDS rate for e-commerce transactions is 1%
Proposed: Rate to be reduced to 0.1% from 01.10.2024
7. New Section 194T – Partner Payments
Introducing a 10% TDS rate on partner payments exceeding Rs 20,000 from 01.04.2025
8. Amendment in Section 206C(1F) – TCS on Luxury Goods
Proposed to include TCS on luxury goods exceeding Rs 10 lakh
9. Amendment in Section 194-IA – Immovable Property Transactions
Clarification on TDS deductions for transactions involving multiple parties, effective from 01.10.2024
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