The Union Budget 2025 introduced several significant amendments to the Tax Deducted at Source (TDS) provisions, aiming to simplify tax compliance and enhance financial flexibility for taxpayers. Key changes include:
1. Section 194 :– TDS on Dividend:– Limit substituted from Rs. 5,000/- to Rs. 10,000/-
2. Section 194A:- TDS on Interest other than securities: – Limit substituted as:
| Taxpayer bank/Co- operative society and Post office | Taxpayer other than Bank/Co- operative Society and Post Office: |
| For General: – limit substituted from 40,000/- to 50,000/- Rs | Limit substituted from 5,000/- Rs to Rs. 10,000/- |
| For Senior Citizen: – limit substituted from Rs. 50000/- to 1,00,000/- lac |
3. Section 194B:- any person who pays any sum in the form of winnings from any lottery or crossword puzzle or card games or other games of any sort : instead of aggregate threshold limit exceeding during the financial year removed and in respect of single transaction is substituted.
4. Section 194D:- Tax Deducted at Source (TDS) on payments made under life insurance policies any payment or reward in the form of commission exceeding Rs 15000/- substituted to Rs 20000/-
5. Section 194G:- TDS on Commission on Sale of Lottery Tickets The Deductor would be liable to deduct TDS under section 194G only if the income amount exceeds Rs.15,000. The limit substituted from Rs.15,000/- to Rs 20,000/-
6. Section 194H:- TDS on Commission The Deductor would be liable to deduct TDS under section 194H only if the income amount exceeds INR 15,000. The limit substituted from Rs. 15000/- to Rs 20000/-
7. Section 194I:- TDS on Rent “Provided that no deduction shall be made under this section, where the income by way of rent credited or paid for a month or part of a month by such person to the account of, or to, the payee, does not exceed fifty thousand rupees:”. i.e. Rs. 6,00,000/- in a year.
8. Section 194J:- TDS on Profession “The Deductor would be liable to deduct TDS under section 194J only if the amount paid exceeds INR 30,000. The limit substituted from Rs. 30,000/- to Rs 50,000/-
9. Section 194K:- Taxation income on dividend from mutual fund “The Deductor would be liable to deduct TDS under section 194k only if the amount paid exceeds Rs.5,000. The limit substituted from Rs.5,000/- to Rs 10,000/-
10. Section 194L:- payment of compensation on acquisition of capital asset “The Deductor would be liable to deduct TDS under section 194l only if the amount paid exceeds Rs. 2,50,000. The limit substituted from Rs.2,50,000/- to Rs 5,00,000/-
11. Section 194LBC:- income distributed by a specified entity to its unit holders Section 194LBC of the Act requires that where any income is payable by a securitization trust to an investor, being a resident, in respect of an investment in a securitization trust as specified therein, the person responsible for making the payment shall, deduct income-tax, at the rate of 10%, if the payee is an individual or a Hindu undivided family and 10%, if the payee is any other person.
12. Section 194Q:- is a provision for Tax Deducted at Source (TDS) applicable to specific high-value goods purchases only TDS under Section 194Q will now apply to the purchase of goods exceeding Rs. 50 lakh.
Section 206C(1H) was omitted, which previously required the collection of tax at source (TCS) on the sale of goods exceeding Rs. 50 lakh.
13. Section 194S: TDS on transfer of Virtual Digital Assets (VDA) section 206AB higher rate of TDS if no PAN furnished removed.
14. Section 206AB: omitted Deduct TDS at higher rates than usual when you make payments to those who have not filed their income tax return in the last year now excludes from income tax
