(Applicable from 1 September 2019)
As per section 194N
TDS is to be deducted by
- Banking Company
- Cooperative Society engaged in business of banking
-
Post office
at 2% on cash withdrawals exceeding Rs. 1 crore
| SECTION | DESCRIPTION | CUTOFF | RATE OF TDS |
| 194N | TDS on cash withdrawals | Rs. 1 crore | 2% |
Example 1
Suppose a person has an account in ICICI Bank.He has already withdrawn Rs. 99 lakh
He further withdraws Rs. 1 lakh
Whether TDS to be deducted?
Answer
No TDS to be deducted as cash withdrawals do not exceed Rs 1 crore
Example 2
Suppose in above example he further withdraws Rs 150000. Whether TDS to be deducted? If yes,on what amount
Answer
Yes, TDS to be deducted as cash withdrawals exceeds Rs 1 crore.
TDS will be dedcuted on Rs. 50000
TDS amount Rs. 50000 * 2% = 1000
Net payment received from bank= Rs.150000 - 1000 = 149000
