Minimum Amount upto which Tax is Not Deducted.

The Income-tax Act has prescribed a different threshold limit for deduction of tax at source under various sections. If the expenditure incurred/payment made during the year is below the threshold limit, then there is no requirement to deduct tax at source.

The threshold limit for deduction of tax at source under various sections is as follows:
S.No.Particulars SectionThreshold Limit
1.No deduction of tax at source from salaries192
If net taxable income is less than the maximum amount which is not chargeable to tax (i.e. Rs. 2,50,000 for an individual other than senior citizen, Rs. 3,00,000 for Senior Citizens and Rs. 5,00,000 for Super Senior Citizens)
1A.No TDS from payment of accumulated balance of provident fund account due to an employee192A
If taxable premature withdrawal amount is less than Rs. 50,000.
2.No TDS from interest paid on debentures issued by a company in which public are substantially interested. Provided interest is paid by account payee cheque to resident individual or HUF193If amount of interest paid during the financial year does not exceed Rs. 5,000
3.No TDS from interest paid on 8% Saving (Taxable) Bonds 2003 or 7.75% Savings (Taxable) Bonds, 2018 (applicable from A.Y 2019-20) to resident persons193If amount of interest  paid or likely to be paid during the financial year does not exceed Rs. 10,000
4.No TDS from interest other than on securities paid by a banking company or co-operative society engaged in carrying on the business of banking194AIf amount of interest paid or credited on time deposit during the financial year exceeds Rs 10,000 (*) (for all type of payee)/Rs 50,000 (from 01/04/2018 if payee is resident senior citizen)
(*) w.e.f. 01/04/2019, the threshold limit is increased from Rs. 10,000 to Rs. 40,000.
5.No TDS from interest on any deposit with a post office under Senior Citizens Saving Scheme Rules, 2004( Notified scheme)194AIf amount of interest  paid or credited on time deposit during the financial year exceeds Rs 10,000 (*) (for all type of payee)/Rs 50,000 (from 01/04/2018 if payee is resident senior citizen)
(*) w.e.f. 01/04/2019, the threshold limit is increased from Rs. 10,000 to Rs. 40,000.
6.No TDS from interest other than on securities if payer is any other person other than post office or banking company or co-operative society engaged on the banking.194AIf amount of interest paid or credited on time deposit during the financial year exceeds Rs 5,000.
7.No TDS from Lottery / Cross Word Puzzles194BIf amount paid during the financial year does not exceed Rs. 10,000.
8.No TDS from winnings from horse races194BBIf amount paid during the financial year does not exceed Rs. 10,000.
9.No TDS to contractor to resident person194Ca) If sum paid/credited to a contractor in a single payment does not exceed Rs. 30,000
b) If sum paid/credited  to contractor in aggregate does not exceed Rs. 1,00,000 during the financial year (Rs. 1,00,000 w.e.f. 01/06/2016)
10.No TDS from insurance commission paid or payable during the financial year to resident person
194DIf amount paid or credited  during the financial year does not exceed Rs. 15,000
11.No TDS from payment of commission or brokerage194HIf amount paid or credited during the financial year does not exceed Rs. 5,000 (Rs. 15,000 w.e.f. 01/06/2016). Further no tax to be deducted from commission payable by BSNL/ MTNL to their Public call office franchisees.
12.No TDS on payment of rent in respect of any land or building, furniture or fittings or plant and machinery to a resident person194IIf amount paid or credited during the financial year does not exceed Rs. 1,80,000 (Rs. 2,40,000 w.e.f. 01/04/2019).
No tax deductions shall be made under this section if rent is paid to a business trust, being a real estate investment trust, in respect of any real estate asset, referred to in section 10(23FCA), owned directly by such business trust.
13.No TDS on payment of consideration for purchase of an immovable property(other than agriculture land) to a resident transferor194IAIf consideration paid or payable for transfer of an immovable property is less than Rs. 50 Lakhs.
14.No TDS on payment of rent of any land or building or both by an individual/HUF [whose books of account are not required to be audited under section 44AB to resident person.194IBIf amount of rent does not exceed Rs. 50,000 for a month or part of a month.
15.No TDS on payment of fee for professional services, fee for technical services, royalty, any sum referred to in section 28(va) to a resident person194JIf amount paid or credited  during the financial year does not exceed Rs. 30,000
16.No TDS on payment of compensation/enhanced compensation  on compulsory acquisition of immovable property (other than Agricultural Land) to a resident person194LAIf such sum amount does not exceed Rs. 2​,50,000  during a financial year.
17.No TDS is required to be deducted on sum payable to a person with respect to contractual work, commission, brokerage or for professional services194MIf the aggregate amount paid or credited during the financial year does not exceed Rs. 50 lakhs
18.No TDS is required to be deducted on the amount withdrawn in cash from any account194NIf the aggregate amount withdrawn does not exceed Rs. 1 crore during the previous year.
However, the threshold limit shall be Rs. 20 lakh if the person, has not filed return of income (ITR) for three previous years immediately preceding the previous year in which cash is withdrawn, and the due date for filing ITR under section 139(1) has expired.
19.No TDS from payment to participants of e-commerce194OIf amount paid or payable Resident Individual or HUF during the financial year does not exceed Rs. 5 Lakhs.
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