Evolution of TDS on Interest on Securities : Clause 393(1)[Table: S.No. 5(i)] & 393(4)[Table: S.No. 6] of Income Tax Bill, 2025 Vs. Section 193 of Income Tax Act, 1961

TDS on interest on securities: consolidated exemptions and clearer procedural rules to streamline withholding compliance.

The Bill reaffirms TDS on interest on securities payable to residents, requiring deduction at the earlier of credit or payment at prevailing rates, subject to an aggregate annual threshold. It consolidates instrument based and entity based exemptions in a notified table, preserves the government's notification power to add exemptions, and modernizes language to reflect current financial instruments. Procedural rules permit declarations for non deduction with clearer delivery and reporting timelines for payers, require documentation to justify non deduction, and emphasize tracking aggregate payments and timely reporting and deposit to improve compliance and reduce disputes.