NEW TDS RATES APPLICABLE FROM 01.10.2009
In India Tax 
Deducted at Source (TDS) is one of the modes of collecting Income Tax from an assessee. TDS is enforced through Income Tax Act 1965. The concept of TDS is based on the theme of ‘PAY AS YOU EARN’.
Objective
• To enable salaried people to pay tax as they earn. This avoids the burden of lump sum payment and pay tax in easy installments.
• Collection of tax at the time of payment of income to various assesses such as contractors, professionals, etc.
• Funds are required by the Government through out the year. Hence TDS and Advance Tax help in regular cash inflows to government.
• To widen Tax network in the country and to stop tax evasion.
The provisions of Sec. 192 to Sec. 195 & Sec. 196A to Sec. 196D of Income Tax Act applies to person making payments of the amounts specified therein to deduct tax. TDS is applicable to income derived from:-
1. Salary. (Sec. 192)
2. Interest on securities. (Sec. 193)
3. Dividend. (Sec. 194)
4. Interest from Banking Company and other than Banking Company. (Sec. 194A)
5. Winning from lottery or crossword puzzle. (Sec 194B)
6. Winning Horse races. (Sec. 194BB)
7. Payment made to Contractors & Sub- contractors. (Sec. 194C)
8. Commission received from Insurance Company. (Sec. 194D)
9. Payment made to non resident sportsmen or sports associations. (Sec. 194E)
10. Payment on account of repurchase of units of Mutual Funds or UTI and NSS. (Sec. 194F) & (Sec. 194EE). At present they are exempt from Income Tax.
11. Commission received on sale of lottery tickets. (Sec. 194G)
12. Commission or brokerage for any services (not being professional services) in course of buying or selling of goods or in relation to any transaction relating to any asset, valuable article or thing, not being securities.
13. Rent (Sec. 194I)
14. Fees received for Professional or Technical services. (Sec. 194J)
The new TDS rates as applicable from 01.10.2009 are published below.
