An order has been issued by Assistant Director SB of Postal Directorate regarding the revised rate of TDS in respect of POSB bank schemes. (SB order 23/2020)

Reduction in rate of TDS in posb bank schemes

The CBDT, Department of Revenue, Ministry of Finance has issued a press release on dated 13.05.2020 regarding the reduction in the rate of TDS in posb bank service.

In order to provide more funds at the disposal of the taxpayers for dealing with the economic situation arising out of COVID-19 pandemic, the rate of tax deduction at source TDS for the following non-salaried specified payments made to residents has been reduced by 25 % for the period from 14 May 2020 to 31 March 2021

The revised rate of TDS on POSB bank schemes are as under:

Sr. No. Section income tax Nature of Payment Existing rate of TDS reduced rate from 14.05.2020 to 31.03.2021 Remark
01. 194 A Interest on other than interest of security 10% 7.5 % SCSS
02. 194 EE Payment in respect of deposit under NSS-87 10% 7.5% NSS-87
03. 194 H Commission on brokerage 05% 3.75% MPKBY/SAS commission

Necessary amendments are being made in Finacle. The non-CBS post office should also take necessary action accordingly.

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Read Also: SB Order 17/2020
Read Also: SB Order 13/2020