Section 393: Tax to be deducted at source

Section 393: Tax to be deducted at source · Complied AI

(2)

Where any income or sum of the nature specified in column B of the Table below, is credited or paid by the person specified in column D during the tax year, to a non-resident specified in column C, the person responsible for paying shall deduct income-tax on the amount of such income or sum,— (a) at the rate specified in column E;

(b)

at the time of credit of income or sum to the account of the payee or at the time of its payment in cash or by way of a cheque or a draft or by any other mode, whichever is earlier; and (c) subject to the provisions of sub-sections (4), (8) and (9). Table FOR PAYMENTS TO NON-RESIDENT Sl. Nature of Income or sum Payee Payer Rate No. A B C D E 1. Any income referred (a) A non- Any person. 20%. to in section 211. resident sportsman (including an athlete) or an entertainer, who is not a citizen of India; or (b) a non- resident sports association or institution. 2. Any income by way of Any non- Any Indian 5%. interest payable in respect resident (not company or a of monies borrowed in being a business trust. foreign currency from a company) source outside India,— or a foreign company.

(a)

under a loan agreement or issue of long- term infrastructure bond on or after the 1st July, 2012 but before the 1st July, 2023; or (b) by way of issue of any long-term bond on or after the 1st October, 2014 but before the 1st July, 2023, which is approved by the Central Government in this behalf. 3 Any income by way of Any non- Any Indian 5%. interest payable in respect resident (not company or a of monies borrowed from a being a business trust. source outside India by way company) of issue of rupee or a foreign denominated bond before company. the 1st July, 2023. A B C D E 4. Any income by way of Any non- Any Indian (a) 4%, interest payable in respect resident company or a where issued of monies borrowed from (not being a business trust. on or after the a source outside India by company) 1st April, 2020 way of issue of any long- or a foreign but before the term bond or rupee company. 1st July, 2023; denominated bond, which or is listed only on a (b) 9%, recognised stock where issued exchange located in any on or after the International Financial 1st July, 2023. Services Centre. 5. Any income by way of Any non- Any 5%. interest. resident infrastructure (not being a debt fund company) referred to in or a foreign Schedule VII company. (Table: Sl. No. 46). Any distributed income Any unit Any business (a) 5%, in 6. referred to in section 223, holder, trust. case of income being of the nature referred being a of the nature to in Schedule V (Table: Sl. non- referred to in No. 3). resident Schedule V (not being a [Table: Sl. No. company) 3.B(a)]; and or a foreign (b) 10%, in company. case of income of the nature referred to in Schedule V [Table: Sl. No. 3.B(b)]. 7 Any distributed income Any unit Any business Rates in force. referred to in section 223, holder, trust. being of the nature referred being a to in Schedule V (Table: Sl. non- No. 4). resident (not being a company) or a foreign company. 8 Any income, other than Any unit Any Rates in force. that proportion of income holder, investment fund which is exempt under being a specified in Schedule V (Table: Sl. No. non- section 224. 2), in respect of units of an resident investment fund specified in (not being a section 224. company) 50 or a foreign company. A B C D E 9. Any income in respect Any Any Rates in of an investment in a investor, securitisation force. securitisation trust being a non- trust specified specified in section 221. resident (not in section 221. being a company) or a foreign company. 10. Any income— Any non- Any As per resident (not Note 2. (a) in respect of units of person. being a a Mutual Fund specified company) or under Schedule VII a foreign (Table: Sl. No. 20) or company. (Table: Sl. No. 21); or (b) from the specified company. 11. Any income in respect Any Any person. 10%. of units referred to in Offshore section 208. fund. 12. Any income by way of Any Any person. 12.5%. long-term capital gains offshore arising from the transfer fund. of units referred to in section 208; 13. Any income by way of Any non- Any person. 10%. interest or dividends in resident. respect of bonds or Global Depository Receipts referred to in section 209. 14. Any income by way of Any non- Any person. 12.5%. long-term capital gains resident. arising from the transfer of bonds or Global Depository Receipts referred to in section 209. 15. Any income in respect Any Any person. As per of securities referred to in Foreign Note 2. section 210(1)(Table: Sl. Institutional No. 1). Investor. 16. Any income in respect a specified Any person. 10%. of securities referred to in fund, referred section 210(1)(Table: Sl. to in Schedule No. 1). VI [ Note 1(g)]. 17. Any interest (not being Any non- Any person. Rates in interest referred to against resident (not force. serial numbers 2, 3, 4 and 5) being a company) or or any other sum a foreign chargeable under the company. provisions of this Act, not being income chargeable under the head “Salaries”.

(3)

Where any income or sum of the nature specified in column B of the Table below, is credited or paid by the person specified in column D during the tax year, to any person, the person responsible for paying the amount specified in column C, shall deduct income-tax on such amount— (a) at the rate specified in column E;

(b)

at the time of payment thereof in cash or by way of a cheque or a draft or by any other mode, or as specified therein; and (c) subject to the provisions of sub-sections (4), (5), (6), (8) and (9). Table FOR PAYMENTS TO ANY PERSON Sl. No.Nature of Income or sum Payer Rate Threshold limit A B C D 1. Any income by way of Any person. Rate: Rates in force. winnings (other than —— winnings from serial Threshold limit: number 2) from–– ₹10,000 in case of a (a) any lottery; or single transaction.

(b)

crossword puzzle; or (c) card game and other game of any sort; or (d) gambling or betting of any form or nature whatsoever 2. Any income by way of Any person. Rate: Rates in force. winnings from online —— game. Threshold limit: Net winnings as per Note 1. 3. Any income by way of Any person, being a Rate: Rates in force. winnings from any horse bookmaker or a —— race. person to whom a Threshold lilmit: licence has been ₹10,000 in case of a granted by the single transaction. Government under any law for the time being in force for horse racing in any race course or for arranging for wagering or betting in any race course. 4. Any income, credited or Any person. Rate: 2%. paid to a person, who is or —— has been stocking, Threshold limit: distributing, purchasing or ₹20,000. selling lottery tickets, by way of commission, 50 remuneration or prize (by whatever name called) on such tickets. A B C D 5. Any sum, paid in cash, Every person, Rate: 2%. from one or more being,— —— accounts maintained by (a) a banking Threshold limit: the deductee. company to which ₹3,00,00,000 in case of the Banking deductee being, a co- Regulation Act, operative society; or 1949 applies (including any (b) ₹1,00,00,000 bank or banking in case of deductee institution being person other than a referred to in co-operative society. section 51 of that Act);

(b)

a co- operative society engaged in carrying on the business of banking; or (c) a post office. 6. Any amount referred to Any person. Rate: 10%. in section 80CCA(2)(a) of —— the Income-tax Act, 1961 (43 of 1961). Threshold limit: ₹2,500. 7. Any sum in the nature Any person, Rate: 10% of salary, remuneration, being a firm. —— commission, bonus or Threshold limit: interest paid to a partner ₹20,000. of the firm or credited to his account (including capital account).

(4)

The deduction of tax at source shall not be made under the provisions referred to in column B of the Table below, in respect of the income or sum, specified in column C: Table FOR NO DEDUCTION AT SOURCE Sl. No. Provisions for tax Condition for no deduction deduction at source A B C 1. Commission or Commission or brokerage payable by Bharat Brokerage referred to Sanchar Nigam Limited or Mahanagar in section Telephone Nigam Limited to their public call 393(1)[Table: Sl. No. office franchisees. 1(ii)]. 2. Rent referred to in Income by way of rent credited or paid to a section 393(1)[Table: business trust, being a real estate investment trust, Sl. No. 2(ii)]. in respect of any real estate asset, referred to in Schedule V (Table: Sl. No. 4), owned directly by such business trust. A B C 3. Compensation on Income by way of any award or agreement acquisition of certain which has been exempted from levy of income- immovable property tax under section 96 of the Right to Fair referred to in section Compensation and Transparency in Land 393(1)[Table: Sl. No. Acquisition, Rehabilitation and Resettlement 3(iii)]. Act, 2013 (30 of 3013). 4. Income in respect of If income is of the nature of capital gain. units referred to in section 393(1)[Table: Sl. No. 4(i)]. 5. Income from units of Income of the nature referred to in Schedule V a business trust referred [Table: Sl. No. 3.B(b)], if the special purpose to in section vehicle referred to in the said clause has not 393(1)[Table: Sl. No. exercised the option under section 200. 4(ii)]. 6. Interest on securities (a) Interest payable on–– referred to in section (i) National Development Bonds; 393(1)[Table: Sl. No.

(ii)

such debentures, issued by such institution or 5(i)]. authority or person as the Central Government may, by notification, specify in this behalf;

(iii)

any security of the Central Government or a State Government, other than–– (A) 8% Savings (Taxable) Bonds, 2003; or (B) 7.75% Savings (Taxable) Bonds, 2018; or

(C)

Floating Rate Savings Bonds, 2020 (Taxable); or (D) any other security of the Central Government or State Government as the Central Government may, by notification, specify in this behalf;

(b)

interest payable to–– (i) the Life Insurance Corporation of India established under the Life Insurance Corporation Act, 1956, in respect of any securities owned by it or in which it has full beneficial interest; or (ii) the General Insurance Corporation of India or to any of the four companies, formed by virtue of the schemes made under section 16(1) of the General Insurance Business (Nationalisation) Act, 1972, in respect of any securities owned by the Corporation or such company or in which the Corporation or such company has full beneficial interest; or (iii) any other insurer in respect of any securities owned by it or in which it has full beneficial interest; or (iv) a “business trust”, as defined in section 2(21), in respect of any securities, by a special purpose vehicle referred to in Schedule V (Table: 50 Sl. No. 3 ). A B C 7. Interest other than (a) Interest income credited or paid to— Interest on securities (i) any banking company; or referred to in section (ii) any financial corporation established 393(1)[Table: Sl. No. by or under a Central Act or State Act or 5(ii) and 5(iii)]. Provincial Act; or (iii) the Life Insurance Corporation of India established under the Life Insurance Corporation Act, 1956 (31 of 1956); or (iv) the Unit Trust of India; or (v) any company or co-operative society carrying on the business of insurance; or (vi) such other institution, association or body or class of institutions, associations or bodies which the Central Government may, for reasons to be recorded in writing, notified in this behalf before the 1st April, 2020;

(b)

interest income credited or paid–– (i) by a co-operative society (other than a co-operative bank) to a member thereof; or (ii) by a co-operative society to any other co-operative society; or (iii) in respect of deposits with a primary agricultural credit society or a primary credit society or a co-operative land mortgage bank or a co-operative land development bank; or (iv) in respect of deposits (other than time deposits made on or after the 1st July, 1995) with a co-operative society, other than a co-operative society or bank referred to in sub-clause (iii), engaged in the business of banking, Where the total sales, gross receipts or turnover of the co-operative society does not exceed ₹50,00,00,000 during the tax year immediately preceding the tax year in which such interest is credited or paid;

(c)

interest income credited or paid— (i) by the Central Government under any provision of this Act or the Income-tax Act, 1961 (43 of 1961), or the Estate Duty Act, 1953 (34 of 1953), or the Wealth-tax Act, 1957 (27 of 1957), or the Gift-tax Act, 1958 (18 of 1958), the Companies (Profits) Surtax Act, 1964 (7 of 1964), or the Interest-tax Act, 1974 (45 of 1974);

(ii)

in respect of deposits under any scheme framed by the Central Government and notified by it in this behalf;

(iii)

in respect of deposits (other than time deposits made on or after the 1st July, 1995) with a banking company; A B C (iv) by way of interest on the compensation amount awarded by the Motor Accidents Claims Tribunal where the amount of such income or, the aggregate of the amounts of such income does not exceed ₹50,000 during the tax year; (v) or payable by an infrastructure capital company; or infrastructure capital fund; or infrastructure debt fund; or a public sector company; or scheduled bank in relation to a zero coupon bond issued on or after the 1st June, 2005 by such company or fund or public sector company or scheduled bank;

(vi)

as referred to in Schedule V (Table: Sl. No. 3);

(vii)

by a firm to a partner of the firm. 8. Payments to (a) When–– contractors referred (i) any sum credited or paid or likely to be to in section credited or paid during the tax year to the 393(1)[Table: Sl. No. account of a contractor during the course of 6(i)]. business of plying, hiring or leasing goods carriages; and (ii) that contractor owns ten or less goods carriages at any time during the tax year; and (iii) furnishes a declaration to that effect along with his Permanent Account Number to the person paying the sum; and (iv) the person responsible for paying to the contractor furnishes to the prescribed income-tax authority the particulars in such form and within such time as prescribed;

(b)

where such sum is credited or paid by individual or Hindu undivided family exclusively for personal purposes of such individual or any member of Hindu undivided family. 9. Fees for Where such sum is credited or paid by professional or individual or Hindu undivided family exclusively technical services for personal purposes of such individual or any referred to in section member of Hindu undivided family. 393(1)[Table: Sl. No. 6(iii)]. 10. Dividend referred to Dividend income credited or paid to— in section 393(1)(Table:

(a)

the Life Insurance Corporation of India Sl. No. 7). established under the Life Insurance Corporation Act, 1956, in respect of any shares owned by it or in which it has full beneficial interest; A B C (b) the General Insurance Corporation of India or to any of the four companies, formed by virtue of the schemes made under section 16(1) of the General Insurance Business (Nationalisation) Act, 1972 (57 of 1972), in respect of any shares owned by the Corporation or such company or in which the Corporation or such company has full beneficial interest;

(c)

any other insurer in respect of any shares owned by it or in which it has full beneficial interest;

(d)

a “business trust”, as defined in section 2(21), by a special purpose vehicle referred to in Schedule V (Note 2);

(e)

any other person as notified by the Central Government in this behalf;

(f)

a shareholder, being an individual, if— (I) the dividend is paid by the company by any mode other than cash; and (II) amount or aggregate of amounts of such dividend distributed or paid or likely to be distributed or paid during the tax year does not exceed ₹10,000. 11. Payment by If the amount is credited or paid or likely to be e-commerce operator credited or paid during the tax year to the account to e-commerce of an e- commerce participant, which is–– participant referred to (a) an individual or a Hindu undivided in section family; and 393(1)[Table: Sl. No. 8(v)]. (b) the gross amount of the sales or services or both during the tax year does not exceed ₹5,00,000; and (c) the e-commerce participant has furnished the Permanent Account Number or Aadhaar number to the e-commerce operator. 12. Payment on Where value or aggregate value of such transfer of virtual consideration during the tax year does not digital asset referred exceed–– to in section (a) ₹50,000, when payable by an individual 393(1)[Table: Sl. No. or a Hindu undivided family,— 8(vi)] (i) whose total sales, gross receipts or turnover from the business carried on by him or profession exercised by him does not exceed ₹1,00,00,000 in case of business or ₹50,00,000 in case of profession, during the tax year immediately preceding the tax year in which such virtual digital asset is transferred;

(ii)

not having any income under the head “Profits and gains of business or profession”;

(b)

₹10,000, when payable by any person other than the person referred to in clause (a). A B C 13. Income from units of a Income of the nature referred to in Schedule V business trust referred to [Table: Sl. No. 3.B(b)], if the special purpose in section 393(2)(Table: vehicle referred to in the said clause has not Sl. No. 6). exercised the option under section 200. 14. Income in respect of Income that is not chargeable to tax under the units of investment provisions of this Act. fund referred to in section 393(2)(Table: Sl. No. 8). 15. Income in respect of Income payable in respect of units of the Unit units of non-residents Trust of India to a non-resident Indian or a referred to in section non-resident Hindu undivided family, subject to 393(2)(Table: Sl. No. prescribed conditions. 10). 16. Income of Foreign Income, by way of capital gains arising from Institutional Investors the transfer of securities referred to in from securities referred section 210, if payable to a Foreign Institutional to in section Investor. 393(2)(Table: Sl. No. 15). 17. Income of Specified Income exempt at Schedule VI (Table: Sl. No. 1) Fund from securities to (Table: Sl. No. 4). referred to in section 393(2)(Table: Sl. No. 16). 18. Payment of certain Payment made to— amounts in cash referred (a) the Government; to in section (b) any banking company or co-operative 393(3)(Table: Sl. No. 5). society engaged in carrying on the business of banking or a post office;

(c)

any business correspondent of a banking company or co-operative society engaged in carrying on the business of banking, as per the guidelines issued in this regard by the Reserve Bank of India under the Reserve Bank of India Act, 1934 (2 of 1934);

(d)

any white label automated teller machine operator of a banking company or co-operative society engaged in carrying on the business of banking, as per the authorisation issued by the Reserve Bank of India under the Payment and Settlement Systems Act, 2007 (51 of 2007). 19. Payment in respect of Payment made to— deposits under National (a) an assessee being and individual; Savings Scheme, etc., (b) heirs of an assessee. referred to in section 393(3)(Table: Sl. No. 6).