TDS on business trust distributions: differentiated resident/non resident rates and SPV contingent exemptions under the Income Tax Bill, 2025. Clause 393 of the Income Tax Bill, 2025 mandates 10% TDS on distributed income to resident unitholders, differentiated rates for non-resident unitholders (including lower rates for certain interest-type distributions and "rates in force" for others), and exempts specified distributions from TDS where the underlying SPV has not opted for the concessional tax regime, thereby tying withholding obligations to the SPV's tax-regime choice.
TDS on infrastructure debt fund interest: concessional withholding retained for non-resident investors, deducted at credit or payment. Clause 393(2)[Table: S.No. 5] retains a concessional TDS regime for any income by way of interest paid by an infrastructure debt fund listed in Schedule VII to a non resident (including foreign companies), requiring deduction at source at the specified concessional rate at the earlier of credit or payment, with no monetary threshold, and integrated within the Bill's harmonised TDS framework that addresses procedural rules, exceptions, grossing up, and interaction with double taxation treaties.
TDS on land acquisition compensation maintained; threshold and RFCTLARR Act exemptions preserved, procedural consolidation introduced. Clause 393 of the Income Tax Bill, 2025 mandates TDS at 10% on any sum in the nature of compensation or enhanced compensation, or consideration or enhanced consideration, for compulsory acquisition of immovable property (other than agricultural land), when amounts paid or credited to a resident exceed Rs. 5,00,000 in a financial year; Clause 393(4) exempts awards or agreements exempt from income-tax under the RFCTLARR Act, and deduction is required at the earlier of payment or credit.
TDS on mutual fund distributions: withholding required at source with exclusion for capital gains, subject to threshold rules. Clause 393 consolidates TDS on income from units of specified mutual funds and analogous instruments, requiring deduction by any payer at the prescribed rate at the time of credit or payment, subject to an aggregate threshold, while expressly excluding receipts that are of the nature of capital gains; the provision retains deeming rules for suspense accounts and links to cross referenced exemptions and schedules for definitions, thereby centralising administrative obligations and necessitating payer systems to characterise payments and aggregate receipts for threshold application.
TDS on professional and technical services clarified: consolidated rates, threshold and personal-payment exemption streamline withholding obligations. Clause 393(1) requires TDS by a specified person on resident payments for professional services, technical services, director's fees (non-salary), royalty and related sums, with distinct lower rates for certain technical, cinematographic and call-centre payments and a higher rate for other cases, deductible at the earlier of payment or credit and applicable only above the prescribed threshold. Clause 393(4) exempts individuals and HUFs from TDS where payments are made exclusively for personal purposes.
TDS on monetary consideration under development agreements - deduction at credit or payment with no threshold. Clause 393(1)[Table: S.No. 3(ii)] requires TDS on any monetary consideration under agreements referred to in section 67(14), applying to any payer, excluding in-kind consideration, with deduction at the earlier of credit or payment, no monetary threshold, and an explicit rule that where both general immovable property TDS and S.No. 3(ii) apply, deduction is to be made only under S.No. 3(ii).
TDS on rent expanded to include equipment and furnished premises, increasing withholding scope and compliance for individuals and HUFs. Clause 393(3)[Table: S.No. 2(ii)] expands TDS on rent by subjecting payments for use of land, buildings, furniture, fittings, machinery, plant and equipment to withholding by specified persons where monthly payments exceed the threshold; it prescribes asset based rates and requires deduction at the earlier of credit or payment for the last month of the tax year or tenancy, while providing a declaration mechanism for nil deduction and procedural reliefs for small non business payers.
TDS on immovable property transfers requires deduction on the higher of consideration or stamp duty value at payment or credit. Clause 393(1)[Table: S.No. 3(i)] requires TDS on transfers of immovable property (excluding agricultural land) where either the consideration or the stamp duty value exceeds the threshold. The transferee is the payer required to deduct tax at a fixed percentage of the higher of consideration or stamp duty value, with deduction at the time of credit or payment. Aggregation of amounts across multiple transferees and transferors applies, and the table provides tie breaker rules and specific exclusions such as compulsory acquisition.
TDS on rent: payer-based uniform and differentiated withholding alters withholding obligations and REIT exemption treatment. Clause 393 requires TDS on rent to residents where monthly rent exceeds the threshold, with deduction at the earlier of credit or payment. Non-specified payers withhold at a uniform low rate for all asset types, while specified persons withhold at differentiated rates for machinery/plant/equipment versus land/building/furniture/fittings. The Bill maintains an exemption from TDS for payments to REITs in respect of directly owned real estate assets and preserves rules treating suspense-account credits as payment for withholding purposes.
TDS on commission and brokerage: Bill preserves current threshold and rate and maintains targeted exemptions for telecom franchisees. Clause 393(1) mandates that a specified person deduct TDS at two percent on resident commission or brokerage payments (excluding insurance commission) when aggregate payments exceed the statutory threshold, with deduction at the earlier of credit or payment and anti avoidance deeming for suspense accounts. Clause 393(4) preserves a targeted exemption for certain telecom franchisee payments, maintaining continuity with existing sectoral relief and reducing compliance burdens.
TDS on lottery-related payments: unified withholding on commissions and prizes with harmonized threshold and deduction rate. Clause 393(3)[Table: S.No. 4] consolidates TDS on payments to persons engaged in stocking, distributing, purchasing or selling lottery tickets, requiring any person making payments of commission, remuneration or prize to deduct tax at the earlier of credit or payment; it includes a deeming fiction treating credits to suspense or intermediary accounts as credit to the payee and imposes standard deductor duties of deposit, certification and return-filing, while leaving aggregation rules and characterization of complex incentive structures unclear.
TDS on national savings withdrawals: mandatory deduction at source with defined threshold and exemptions for individuals and heirs. Clause 393(3)[Table: S.No. 6] requires any person responsible for paying amounts referred to in section 80CCA(2)(a) to deduct income-tax at the rate of 10% at the time of payment where the amount or aggregate amount paid during the tax year exceeds Rs. 2,500; the Table under sub-section (4), Sl. No. 19, exempts payments made to an assessee who is an individual and to the heirs of an assessee, and payers must deposit TDS, file returns, and issue certificates in accordance with the procedural framework.
Source-based taxation requires payers to withhold tax on non-resident sports and entertainment fees, ensuring collection at source. Clause 393(2)[Table: S.No.1] mandates a tax deduction at source on payments to non-resident sportsmen, entertainers, and non-resident sports associations or institutions for income referred to in section 211, imposing the obligation on any person making the payment to deduct tax at the earlier of credit or payment. The provision specifies a flat withholding rate, explicitly addresses grossing up for net-of-tax contracts, and is integrated within wider TDS subsections providing exceptions and administrative rules.
TDS on non-exempt life insurance payouts: mandatory deduction on the taxable component with a declaration option to avoid deduction. Clause 393(1)[Table: S.No. 8(i)] of the Income Tax Bill, 2025 requires any person paying sums under a life insurance policy, including bonuses and excluding amounts not includible under Schedule II, to deduct TDS at 2% on the "income comprised in such sum". Deduction is required only where the aggregate payout to a payee in a tax year exceeds the specified threshold, and it must be effected at the earlier of credit or payment. Sub-section 6 allows a declaration for non-deduction where estimated aggregate income is below the exemption limit.
TDS on insurance commission: mandatory deduction at earlier of credit or payment, with threshold and declaratory relief. Clause 393(1)[Table: S.No.1(i)] requires deduction of tax at source on remuneration or reward for soliciting, procuring, continuing, renewing or reviving insurance business, payable by "any person", at the earlier of credit or payment, when aggregate payments to a payee exceed the specified threshold; rates are those in force and the provision expands scope to include incentives and other remuneration while providing a declaration-based mechanism for no deduction and deeming credit to suspense accounts as credit to the payee.
TDS on contractor payments upheld with clarified scope, invoice rules and procedural reporting for targeted exemptions. Clause 393(1)[Table: S.No. 6(i)] applies TDS to sums for carrying out work, including supply of labour, payable by a designated person, preserving differential rates for individuals/HUFs and others, applying deduction at credit or payment, allowing exclusion of material where separately invoiced, and aggregating payments for threshold purposes, subject to specified exceptions and procedural requirements.
TDS on horse-race winnings: single-transaction threshold triggers deduction at payment, integrated into unified TDS framework. Clause 393(3)[Table: S.No. 3] mandates TDS on horse-race winnings by bookmakers or licensed operators at prevailing rates where winnings in a single transaction exceed the threshold, requires deduction at payment irrespective of mode, and integrates these obligations into Clause 393's unified procedural framework while leaving open interpretive issues such as the definition of "single transaction," aggregation risk, and valuation of non-cash payouts.
TDS on online gaming winnings: mandatory source deduction on net winnings, requiring payer compliance, reporting, and collection for noncash prizes. Clause 393(3)[Table: S.No. 2] mandates TDS on "any income by way of winnings from online game" payable or credited by "any person," requiring deduction at "rates in force" on net winnings (as per Note 1) at the time of payment or credit, irrespective of mode of payment including cash, kind, credits or digital assets; payer obligations include computation, deduction, remittance, certification and reporting, with standard consequences for non-compliance.
TDS on gaming winnings: tax must be deducted at payment with a single-transaction threshold and special rules for non-cash prizes. Clause 393(3)[Table: S.No.1] requires payers to deduct tax at source at rates in force on winnings from lotteries, puzzles, card games, other games, gambling and betting at the time of payment. The provision applies to cash and in-kind prizes and uses a single-transaction threshold to trigger TDS; payers must ensure tax is paid before releasing non-cash prizes. Online gaming winnings are excluded from this sub-clause and treated separately. General TDS reporting and deposit obligations apply.
TDS on interest: Bill raises senior citizen threshold and consolidates exemptions, altering deductor obligations and clarifying procedures. Clause 393(1)[Table: S.No. 5(ii) & 5(iii)] prescribes TDS on interest other than on securities by distinguishing banking companies, co operative banks and post offices (subject to higher thresholds) from other specified payers (subject to a lower threshold), fixing time of deduction as credit or payment whichever is earlier, retaining branch wise aggregation where core banking is absent, and allowing intra year adjustment; Clause 393(4)[Table: S.No. 7] lists exemptions mirroring institutional and co operative carve outs with turnover conditions and freezes new ad hoc notifications after the stipulated cutoff.
Procedure for processing applications for advance rulings in the Indian tax regime : Clause 384 of the Income Tax Bill, 2025 and Section 245R of the Income-tax Act, 1961
4 July, 2025
Contents
Acts
Rules & Regulations
Summary
Note
Bookmark
Share
✓ Copied successfully !
Print
Print Options
For full text, please login
Login to TaxTMI
Verification Pending
The Email Id has not been verified. Click on the link we have sent on
Advance ruling procedure secures binding tax guidance with hearing rights, grounds for rejection, and mandatory communication. Clause 384 requires the Board for Advance Rulings to forward applications to the Principal Commissioner or Commissioner, call for records, and after ... Summary
Advance ruling procedure secures binding tax guidance with hearing rights, grounds for rejection, and mandatory communication.
Clause 384 requires the Board for Advance Rulings to forward applications to the Principal Commissioner or Commissioner, call for records, and after examination either allow or reject applications. Rejection must follow an opportunity to be heard and a reasoned order, and orders must be communicated to the applicant and tax authorities. Mandatory exclusions include pending proceedings, fair market value determinations, and transactions prima facie designed for tax avoidance; if allowed, the Board must examine further material, hear the applicant or authorised representative, and pronounce a written ruling within the prescribed time frame.
Full Summary is available for active users!
Note: It is a system-generated summary and is for quick reference only.
TaxTMI 
TaxTMI 
of 123 
