Withholding on FII securities income: tax deducted at prescribed rates, subject to treaty relief and special fund rate. Payers must deduct tax at the time of credit or payment on income of Foreign Institutional Investors from securities under section 115AD, excluding interest covered elsewhere. If a tax treaty applies and the payee furnishes the required certificate, withholding is at the lower treaty or domestic rate. Certain specified funds attract a lower withholding rate and income exempt under the specified provision is not subject to deduction. No deduction is made on capital gains from transfer of securities under section 115AD.