Rate of TDS on Interest on Debenture, Bonds and other Listed Securities under section 193 of the Income Act

Nature Of Payment

“Interest of securities”

EXCEPTIONS:

  • Interest payable on notified debenture, bonds and other securities

    For Example, National defence Bonds, 1972; National defence Loans, 1972 National developments Bonds

  • Interest payable on securities of Central Govt. / State Govt.[However TDS is necessary in case of 8% saving (Taxable) Bonds,2003]
  • Interest on debenture, if following conditions are satisfied:-
    • Payee is an individual
    • Payer is a widely-held company
    • Debenture are listed on a recognized stock exchange in India
    • Payment is made by an “A/c payee” cheque
    • The amount of interest payable during a financial year does not exceeds Rs.2500/-
  • If the payee is –
    • A fund established for the benefit of armed forces;
    • Ramakrishna mission;
    • Regimental funds;
    • Employee’s provident funds
    • LIC,GIC and other insurer.

Interest payable on any security issued by a company, where such security is in dematerialized from and is listed on a recognized stock exchange in India.

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