As per section 194H

TDS is to be deducted on Commission at 5%

However, No TDS is to be deducted if annual amount is upto 15000 per annum. If Amount is 15001 then TDS is deducted.

Section

Description

Cut off

Rate of TDS

Section 194 H

Payment of Commission

15000 p.a.

5%

 

 


Changes in 194H Due to Lockdown

However,Due to Lockdown,Government has temporarily reduced Rate by 25%

hence,TDS Rate on Commission Service is Changed as follows

  Current Rate New Rate (Temporary)
TDS on Commission 5% 5%*75%=3.75%

 

Note - This New Rate is Temporary only if TDS Deducted form 14 May 2020 to 31 Mar 2021
After this old Rate will be applicable

 

Questions

Q1.

Building purchased for 40 lacs from DLF 2% Commission paid to Khosla Properties

View Answer

Q2.

Cash Sales 5000 pieces @ 60 each Rs 300000.Commission paid to Sales Agent Amit  @ Rs 20 per piece 

View Answer

Section 194H TDS on Commission - Rates of TDS

 

 

  1. Tax Practical
  2. Practical TDS (Non Salary)

About the Author

CA Maninder Singh's photo - Expert in Practical Accounts, Taxation and Efiling
CA Maninder Singh
CA Maninder Singh is a Chartered Accountant for the past 10 years. He also provides Accounts Tax GST Training in Delhi and Pune.