NEW TDS RULES: Big relief for senior citizens, small investors
The annual interest exemption limit for TDS has been doubled to Rs.1,00,000.
STC NEWS MONITORING DESK
SRINAGAR, SEPTEMBER 28 (STC): The Central government has introduced significant changes to Tax Deducted at Source (TDS) rules effective from September 25, 2025. The changes, which cover interest on deposits, dividends, commissions, and lottery winnings, are expected to benefit senior citizens, middle-class families, and small investors. These
Tax and financial experts siad that these changes will put more cash in the hands of tax payers instead of getting locked in refunds.
Key highlights
Senior Citizens: The annual interest exemption limit for TDS has been doubled from ₹50,000 to ₹1,00,000. For example, if a retiree earns ₹80,000 in annual interest, no TDS will be deducted. Kaushik called it a “big relief for retirees relying on deposits for daily expenses.”
Non-Senior Citizens: The exemption limit on FD/RD interest has been raised from ₹40,000 to ₹50,000, providing more liquidity for middle-class families.
Lottery Winnings: TDS will now apply only if a single winning exceeds ₹10,000. Previously, the rule considered the total annual winnings, which penalised frequent small-ticket winners.
Insurance Commissions: The TDS threshold has increased from ₹15,000 to ₹20,000, benefitting part-time and small agents who earlier struggled with refunds.
Dividend Income: The exemption limit has doubled from ₹5,000 to ₹10,000, encouraging small investors to stay invested in equities and mutual funds.
Meanwhile, for fixed deposit and recurring deposit investors, the changes translated into less TDS deducted at source; higher take-home interest credited monthly; reduced hassle of seeking refunds during income tax filing; improved household cash flow for day-to-day expenses.
“When money stays in your (small investors) hand instead of refunds, you’re more likely to reinvest, spend wisely, or save better,” said a Chartered Accountant.
To be precise, the new TDS regime is fairer, with clear benefits for seniors, families, and small investors.
(Straight Talk Communications)
