CBDT Clarifies Non-Applicability of Higher TDS/TCS Rates in Case of Deceased Deductees or Collectees Pre-Aadhaar-PAN Linkage

The Central Board of Direct Taxes (CBDT) clarified that higher rates of Tax Deducted at Source (TDS) and Tax Collected at Source (TCS) under Section 26AB and 26CCA of the Income Tax Act do not apply in the case of deceased persons. The clarification came after concerns were raised regarding the application of these provisions for non-linked Aadhaar-PAN cases involving deceased individuals. The clarification ensures that the higher TDS/TCS rates intended to enforce compliance do not affect transactions involving the estates of deceased persons where linking of PAN with Aadhaar was not completed before the individual's death.