New TDS Rules 2025: In the Union Budget-2025, the Finance Minister had announced many changes related to tax. During this, some changes have also been made in the rules of TDS (Tax Deducted at Source), which are going to be implemented from April 1, 2025.
The purpose of these changes is to provide financial relief to taxpayers, investors, senior citizens and commission earners. Let us know what will be the benefit of these changes in different categories.
TDS limit increased for mutual funds and stocks
Due to increased TDS exemption, investors will get more exemption on dividend income and income from mutual funds (MF). In the Union Budget 2025-26, the government has increased the TDS exemption limit (TDS limit increased for mutual funds and stocks) from Rs 5,000 to Rs 10,000 on income from dividends received on shares and mutual fund units from April 1.
TDS limit on dividend income
In the Union Budget presented this year, the TDS limit on dividend income has been changed, this exemption has been increased from Rs 5,000 to Rs 10,000. This means that now investors will be able to save a larger part of their income.
Higher TDS exemption for senior citizens
To provide financial relief to senior citizens, the government has doubled the TDS exemption limit on interest income (Higher TDS exemption for senior citizens). From April 1, 2025, banks will deduct TDS on interest income from fixed deposits (FD) and recurring deposits (RD) only if the total interest income in a financial year exceeds Rs 1 lakh. This means that if the annual interest income of a senior citizen remains within this limit, then no TDS will be deducted.
TDS limit increased for common citizens
For people below 60 years of age, the TDS limit on interest income has been increased from Rs 40,000 to Rs 50,000. This move will be especially beneficial for those who depend on FD interest income. Now, banks will deduct TDS only if the total interest income in a financial year exceeds Rs 50,000.
TDS on lotteries
The government has also increased the TDS limit on income from lottery, crossword puzzles and horse riding. Earlier, TDS was deducted on winning more than Rs 10,000 in a financial year, even if this amount was received in several small amounts. According to the new rules, now TDS will be deducted only when the single transaction is more than Rs 10,000.
For example, currently if a person wins Rs 5,000 three times in a year (total Rs 15,000), then TDS is applicable. After the new rules come into force, as long as the single transaction is less than Rs 10,000, no tax will be deducted.
Relief for insurance agents and brokers
The new rules have given relief to insurance agents and brokers by increasing the limit of TDS for commission. The TDS limit for insurance commission has been increased to Rs 20,000. Earlier this limit was Rs 15,000.
Related Articles:-
Gratuity Rule: Those rules of gratuity which every employee should know
Weather Forecast: Alert of heavy rain and hailstorm simultaneously for the next 7 days
HRA Exemption: What to do if the landlord refuses to give the PAN number? Details Here
