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Banks exempt from 10% TDS on one-time loan settlements, waivers: CBDT

Issue of bonus and rights shares too will not require tax to be deducted under a section introduced in the Union Budget

Lending, banks, credit, loans, cash, income, wage, earning
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Nikunj Ohri New Delhi
Banks and financial institutions will not have to deduct 10 per cent tax deductible at source (TDS) on one-time loan settlements and waivers, the Central Board of Directs Taxes (CBDT) has said.

The CBDT clarified the issue of bonus and rights shares will not require tax to be deducted under the Section 194R introduced in the Union Budget. Section 194R came into effect from July 1, 2022 and required 10 per cent TDS deduction to persons providing any benefit or perquisite to a resident, on the value of such benefit.

Banks had raised concerns over the applicability of the provision, saying such

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First Published: Sep 14 2022 | 12:56 PM IST

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