Lower Tax Deduction Certificate stop overpaying TDS — apply under Section 197.
End-to-end services for obtaining a Lower Tax Deduction Certificate under Section 197 of the Income Tax Act — essential for NRIs selling property, taxpayers in refund position, and entities where statutory TDS rate is far higher than actual tax liability.
A Lower Tax Deduction Certificate (LDC) under Section 197 allows the income tax authority to certify that a payee's tax liability for the year is lower than what statutory TDS rates would deduct — and authorise the payer to deduct TDS at a lower rate, or even nil rate, for the year. It is the only way to avoid blocking refund capital for an entire year.
LDCs are commonly used by NRIs selling Indian property (where Section 195 default rates can be 20% to 23.92% on the full sale price), large contractors and professionals in refund position, exporters with significant input tax credit, taxpayers with carry-forward losses, and any entity where actual tax liability is far below the statutory deduction rate.
Our LDC team handles the application end to end — from preparing the financial projections and tax computation to filing Form 13 on TRACES, providing supporting documents, representing before the jurisdictional Assessing Officer, addressing AO queries, securing the certificate at the right rate, and renewing it year on year.
Our LDC Services
Eligibility Assessment
Review of taxpayer profile, projected income, and TDS rates to assess LDC viability and target rate.
Form 13 Application
Online filing of Form 13 on the TRACES portal with proper deductor and section details.
Projection & Computation
Preparation of detailed income projection, deduction computation, and tax liability working for the year.
Supporting Documents
Compilation of return history, financial statements, agreements, valuation reports, and other supporting documents.
AO Representation
Personal representation before the jurisdictional AO at hearings, with response to all queries.
NRI Property LDC
Specialised LDC support for NRIs selling Indian property under Section 195, with capital gains computation.
Annual Renewal
Annual renewal of LDC for ongoing engagements, with updated projections and supporting documents.
Deductor Coordination
Coordination with deductors to ensure the certificate is correctly applied for the validity period.
Our LDC Workflow
Viability Review
Initial review of taxpayer profile, expected TDS, and computation of target LDC rate.
Document Compilation
Income projection, tax computation, prior returns, contracts, and other supporting documents.
Form 13 Filing
Online filing on TRACES portal with deductor PAN-section details for the validity period.
AO Hearings
Attendance at AO hearings, response to queries, and submission of additional documents.
Certificate Issue
Receipt of LDC, communication to deductors, and tracking through deduction cycle.
Why an LDC Pays Off
Frequently Asked Questions
An LDC under Section 197 is a certificate from the Assessing Officer allowing TDS to be deducted at a lower or nil rate when actual tax liability is lower than statutory TDS would deduct.
NRIs selling property, contractors and professionals in refund position, entities with carry-forward losses, exporters, and any payee where statutory TDS far exceeds actual tax liability.
Generally 3 to 6 weeks from filing of Form 13, subject to AO workload, additional queries, and documents required for the assessment.
No. An LDC is valid only for the financial year for which it is issued. A fresh Form 13 must be filed each year if the certificate is needed.
If the AO denies the LDC or issues it at a higher rate than justified, the taxpayer can file revision under Section 264 or pursue rectification, depending on facts.
Paying More TDS Than Your Actual Tax?
Stop blocking refunds for an entire year. Talk to our team for a Section 197 LDC application, AO representation, and a certificate at the right rate.
Apply for LDC or call +91 9819 000 511