No tax deduction u/s 194A for Senior Citizens where aggregate amounts of interest credited or paid during financial year does not exceed Rs. fifty thousand – CBDT
F. No. Pro DGIT(S)/CPC(TDS)/Notification/2018-19
Notification No. 06/2018
Government of India
Ministry of Finance
Central Board of Direct Taxes
Directorate of Income-tax (Systems)
New Delhi, 06th December, 2018
Subject: – TDS deduction under section 194A of the Income-tax Act, 1961 in case of Senior Citizens – reg.-
It has been brought to the notice of CBDT that in case of Senior Citizens, some TDS deductors/Banks are making TDS deductions even when the amount of income does not exceed fifty thousand rupees. The same is not in accordance with the law as the Income-tax Act provides that no tax deduction at source under section 194A shall be made in the case of Senior Citizens where the amount of such income or, the aggregate of the amounts of such income credited or paid during the financial year does not exceed fifty thousand rupees.
(Please refer to the third proviso to sub-section 3 of section 194A)
2. Under sub-rule (5) of Rule 31A of the Income-tax Rules, 1962, the Director General of Income-tax (Systems) is authorized to specify the procedures, formats and standards for the purposes of furnishing and verification of the statements or claim for refund in Form 26B and shall be responsible for the day-to-day administration in relation to furnishing and verification of the statements or claim for refund in Form 26B in the manner so specified.
3. In exercise of the powers delegated by the Central Board of Direct Taxes (Board) under sub-rule (5) of Rule 31A of the Income-tax Rules, 1962, the Principal Director General of Income-tax (Systems) hereby clarifies that no tax deduction at source under section 194A shall be made in the case of Senior Citizens where the amount of such income or, the aggregate of the amounts of such income credited or paid during the financial year does not exceed fifty thousand rupees.
( Dewangi Marthak )
Asstt. Commissioner of Income-tax (CPC-TDS),
0/0 the Pr. Director General of Income-tax (Systems),
Copy for kind information to:-
1. PPS to the Chairman and all Members, CBDT, North Block, New Delhi.
2. All Pro Chief Commissioners/Pro Director Generals of Income-tax/Chief Commissioners of Income-tax/Pr. Commissioners of Income-tax/Commissioners of Income tax/Commissioners of income-tax (TDS) with a request to circulate amongst all officers in their regions/charges.
3. JS (TPl)-1 & II / Media Coordinator and Official spokesperson of CBDT.
4. ADG(IT) / ADG(Audit) / ADG(Vig.) / ADG(Systems) 1, 2, 3,4, 5/ ADG(TPS) – 1, 2 / CiT(CPC~ITR) / CIT (CPC-TDS).’
5. ADG (PR, PP & OL).
6. Chief General Manager-in-Charge, Department of Government and Bank Accounts, Reserve Bank of India, Opp. Mumbai Central Railway Station, Mumbai 400 008 with request for wide circulation among Banks and necessary complaince.
7. TPL, ITA and IT(B) divisions of CBDT.
8. The Institution of Chartered Accountants of india, I.P. Estate, New Delhi.
9. The Web-Manager, ‘incometaxindia.gov.in’ for hosting on the website.
10. Database cell for uploading on www.irsofficersonline.gov.in and in DGIT(Systems) corner.
11. ITBA publisher for uploading in ITBA portal.
12. ITO (CPC-TDS)-11 for uploading on TRACES portal.