New TDS Rules 2025: How Changes In FD, Dividend & Rent Income Affect You

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Massive changes regarding amendments in TDS are in store, which will impact taxpayers earning through fixed deposits, dividends and rental income from April 2025. The government has brought further reforms in last-gasp efforts to bear with small taxpayers and ease things for them. Now lets’ check more about these TDS rules and what exactly will be the benefits.

Major Changes In TDS Rule Come April 2025  

1. More Exemption on TDS on FD Interest

  • TDS exemption will be raised for interest on fixed deposits. 
  • The earlier ceiling beyond which banks deducted TDS was ₹40,000 for individuals and ₹50,000 for senior citizens. 
  • Now, as per the new rule, thresholds have increased to ₹60,000 for individuals and ₹75,000 for senior citizens.
  • This benefaction would save depositors from an extra tax burden, especially small depositors and old depositors.  

2. Change on TDS on Dividend Income

  • Increased threshold of Tax Deducted at Source on dividends of shares and mutual funds. 
  • TDS threshold on dividends was previously 5,000, but has now been tinkered to ₹10,000. 
  • Hence, any person now receiving dividend income will not have TDS on it if below this threshold.  

3. TDS On Rent Income  

  • In case rent income goes past the specified threshold limit, TDS will be applicable.
  • Earlier, this amount was ₹2.4 lakh per annum, which has now been increased to ₹3 lakh. 
  • Certainly, this is a relief for small landlords and will further ease the compliance burden on them.  

Who Will Benefit By This? 

  • Senior Citizens: The interest threshold increases mean fewer deductions of tax that customers can expect making income from fixed deposit investments more efficient. 
  • Small Investors: Small investors benefiting from dividend receipts have already found help with their TDS slab modification. 
  • Landlords: Renters earning less than ₹3 lakh income will now find themselves free from TDS deduction.  

Maximize Your Profit Earned  

  1. Submission of Form 15G and 15h: No TDS deduction is likely when income falls below taxable limits-give Form 15G (for individuals) or Form 15H (for senior citizens).
  2. Watchful Eye on Income: Try to remain below the TDS exemption new ceilings on the interest, dividends, and rental income.  
  3. Professional Tax Guide: This means the optimization of one’s tax planning while minimizing one’s tax liability at that particular moment in time.  

Conclusion 

The whole TDS reform bill starting April 2025 shall be a boon as good reforms for small taxpayers with senior citizens. An increased threshold means many more incomes will stay unimpeded by TDS. Keep yourself ready, keep your forms filed, and enjoy.

Also Read: DA Hike Latest Update: 3% Increase In DA Of Central Employees Confirmed, Not 2%

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