TDS should be deducted on the amount exceeding Rs. 1 crore withdrawn by the taxpayer.
- The limit of Rs. 1 crore is per bank or post office account.
- Therefore, if the taxpayer has five accounts from different banks and if from each account he is going to withdraw Rs. 50 lakh. The total comes to Rs.2.5 crore but TDS need not be deducted because the limit has not been exceeded in individual banks.
Rate of TDS
TDS will be deducted at a rate of 2% on cash withdrawals in excess of ₹ 1 crore if the person withdrawing the cash has filed an income tax return for any or all three previous AYs.
TDS will be deducted at 2% on cash withdrawals of more than ₹ 20 lakh and 5% for withdrawals exceeding ₹ 1 crore if the person withdrawing the cash has not filed ITR for any of the preceding three AYs.
| Withdrawal |
Total amount Withdrawal |
Threshold limit based on Filing of Income-tax Return |
Amount on which TDS should be deducted |
Rate |
TDs to be deducted |
- PNB – Rs. 50 Lakh
- HDFC – Rs. 50 Lakh
- Post office –Rs. 25 Lakh (Income tax filed for the Previous three AY)
|
Rs. 1.25 Cr |
Rs. 1 Cr (per bank) |
Nil |
2% |
Nil |
- PNB – Rs. 50 Lakh
- HDFC – Rs. 50 Lakh
- Post office –Rs. 25 Lakh (Income tax not filed for the Previous three AY)
|
Rs. 1.25 Cr |
Rs. 20 Lakh (per bank) |
Rs. 65 Lakh(Rs. 30 Lakh +Rs. 30 Lakh + Rs. 5 Lakh) |
2% |
Rs. 1.3 Lakh |
| PNB -Rs. 1.25 Cr |
Rs. 1.25Cr |
Rs. 1 Cr (per bank) |
Rs. 25 Lakh |
2% |
Rs. 50K |
