SB Order 09/2024: Revision of TDS Rate on Agent’s Commission
SB Order 09/2024: Revision of TDS Rate on Agent’s Commission: Effective from October 1, 2024. Download SB Order 09 2024 in PDF.
New Delhi, October 1, 2024 – The Government of India, through the Department of Posts under the Ministry of Communications, has announced a revision in the rate of Tax Deduction at Source (TDS) for Agent’s Commission. This significant amendment is part of the Finance Bill 2024, issued by the Ministry of Finance. Effective from October 1, 2024, the TDS rate on Agent's Commission will be reduced from 5% to 2% under Clause 57, Section 194H of the Income Tax Act.
Key Highlights of the Revision:
- New TDS Rate: The TDS on Agent’s Commission has been reduced from 5% to 2%.
- Effective Date: The revised rate will be applicable from October 1, 2024.
- Legal Basis: This change is introduced through an amendment in Section 194H of the Income Tax Act. The new wording replaces the phrase "five percent" with "two percent."
Implications for Agents
The reduction in TDS aims to provide relief to agents who earn commissions, especially those working in sectors such as postal savings and small savings schemes. With this reduction, agents will experience lower tax withholding on their commission earnings, enhancing their immediate cash flow.
Departmental Action
The Department of Posts has circulated the directive to all Head of Circles and Regions to ensure the proper implementation of this revised TDS rate. It is mandatory for all Post Offices to update their public notice boards with this information, ensuring agents and the public are aware of the changes.
Instructions for Postal Circles and Financial Services:
The revision must be communicated promptly across all financial services divisions, including:
- Postal Circles and Regions
- Postal Accounts and Savings Schemes
- Parcel Directorate, BD Directorate, and PLI Directorate
- Recognized Federations, Unions, and Associations within the postal system
This directive, issued by the Assistant Director (SB-I), P Kumar, has received approval from the Competent Authority and is effective immediately. The revised rate brings much-needed clarity and reduces the tax burden for agents, aligning with the government’s financial reforms for easing tax obligations.
For further details, the notification is available at Dak Bhawan, New Delhi, and will be circulated across all concerned departments for swift implementation.
