The tax authority has released an updated TDS and TCS rate chart for FY 2026-27, detailing revised deduction rates on salary, interest, property, gaming, foreign remittances, and specified goods transactions.
Kashish Bhardwaj | Apr 9, 2026 |
TDS and TCS Rate Chart for Tax Year 2026-2027
The tax authority has released a Tax Deducted at Source (TDS) and Tax Collection at Source (TCS) rate chart for the Financial Year 2026-27, effective from April 1, 2026. This chart includes distinct tax deduction and collection rates applied to different categories.
Salary payments will normally be taxed as per the income tax rates. On the other hand, 10% TDS will apply to premature EPF withdrawals. Generally, 10% TDS rate is applied to interest, dividends and professional fees. TDS at a rate of 1% to 2% will be charged on contractor payments and insurance commissions.
An increased rate of 30% TDS will be applicable on income earned from lottery, online gaming and horse racing. Special TDS rates and limits have been decided for property transactions, rent, and purchase of goods, such as 1% TDS on property purchases above Rs 50 lakh. Cash withdrawals, e-commerce, virtual digital assets and non-resident payments are covered under separate provisions. Under TCS provisions, 2% TCS will be applicable on specified goods and 1% TCS on luxury goods (worth above Rs 10 lakh). Rates on foreign remittances and tour packages have been rationalised.
TDS Rate Chart
| Codes to be used in return | Old Section | Nature of Payment | TDC Section (IT ACT 2025) | Rates | threshold |
| 1004 | 192 | Payment of the outstanding amount deposited by the employee | 392(7) | – | |
| 1005 | 194D | Insurance-related commission or brokerage | 393(1) | Rates in force | 20000 |
| 1006 | 194H | Other types of commission or brokerage | 393(1) | 2% | 20,000 |
| 1008 | 194I(a) | Rent of machinery, etc. (paid to the prescribed person) | 393(1) | 2% | 50,000 per month |
| 1009 | 194I(b) | Rent of property other than machinery (paid to a prescribed person) | 393(1) | 10% | 50,000 per month |
| 1011 | 194IC | Cash payment as per agreement under section 67(14) | 393(1) | 10% | – |
| 1012 | 194IA | Payment of compensation on the acquisition of certain immovable property | 393(1) | 1% | 50 Lakh |
| 1013 | 194K | Income received by a resident from units of specified mutual funds | 393(1) | 10% | 10,000 |
| 1014 | 194LBA | Interest received by resident unit holders from business trust units | 393(1) | 10% | – |
| 1015 | 194LBA | Dividend received by resident unit holders from units of a business trust | 393(1) | 10% | – |
| 1017 | 194LBB | Income (other than exempt income) from units of investment fund (section 224) | 393(1) | 10% | – |
| 1018 | 194LBC | Income to the investor from investment in a securitisation trust (section 221) | 393(1) | 10% | – |
| 1019 | 193 | Income in the form of interest received on securities | 393(1) | Rates in force | 10,000 |
| 1020 | 194A | Interest income other than securities, when the recipient is a senior citizen | 393(1) | Rates in force | 100,000 |
| 1021 | 194A | Interest income other than securities, when the recipient is not a senior citizen | 393(1) | Rates in force | 50,000 |
| 1022 | 194A | Interest of any kind other than securities | 393(1) | Rates in force | 10,000 |
| 1023 | 194C | Payment for the execution of any work (including supply of labour) in accordance with the contract, when the contractor is an individual or a Hindu undivided family | 393(1) | 1% | 30,000 |
| 1024 | 194C | Payment for the execution of any work (including supply of labour) in accordance with the contract, when the contractor is other than an individual or a Hindu Undivided Family | 393(1) | 2% | 100,000 |
| 1026 | 194J(a) | The following types of payments: (a) Fees for technical services (other than professional services), (b) Royalties relating to the sale, distribution or exhibition of cinematographic films (c) Payment to a payee engaged only in the business of call centre operations | 393(1) | 2% | 50000 |
| 1027 | 194J(b) | Following types of payments: (a) Fees for professional services, (b) The amount referred to in section 26(2)(h) | 393(1) | 10% | 50,000 |
| 1028 | 194J(b) | Remuneration, fees or commission paid to a director of a company (other than tax deducted under section 392) | 393(1) | 10% | – |
| 1029 | 194 | Dividend declared to resident unit holders (including preference shares) | 393(1) | 10% | – |
| 1030 | 194DA | Amount received under a life insurance policy, including bonuses (except amounts not included in total income under Schedule II) | 393(1) | 2% | 100,000 |
| 1031 | 194Q | Any amount paid in respect of the purchase of goods | 393(1) | 0.10% | in excess of 50 lakh |
| 1033 | 194R | Any profits or facilities derived from a resident’s business or profession, whether or not convertible into cash | 393(1) | 10% | 20,000 |
| 1034 | 194R | Benefits of business or profession, paid wholly in kind or partly in cash, which are not sufficient to meet the tax liability, and tax is deposited before the benefits are paid | 393(1) | 10% | 20,000 |
| 1035 | 194O | Any amount paid by an e-commerce operator to an e-commerce participant in exchange for the sale of goods or services provided through its digital platform | 393(1) | 0.10% | – |
| 1037 | 194S | Any consideration paid for the transfer of a virtual digital asset, where the payer is other than an individual or a Hindu Undivided Family (HUF) | 393(1) | 1% | – |
| 1038 | 194SP | Any payment given in cash, kind, or a combination of the two in exchange for the transfer of a virtual digital asset | 393(1) | 1% | – |
| 1058 | 194B | Income from winnings from lotteries, crosswords, card games, any other game, gambling or betting (except as specified) | 393(3) | Rates in force | Rs. 10000 in case of a single transactions |
| 1059 | 194B | Winnings from the above games or betting where payment is in kind or cash is not sufficient, and tax is paid before the winnings are awarded | 393(3) | Rates in force | Rs. 10000 in case of a single transactions |
| 1060 | 194BA | Income from any kind of winnings received from online games | 393(3) | Rates in force | on net winnings in the user A/c of the payee at the end of the tax year |
| 1061 | 194BA | Income from winnings received from online games, where the payment in kind or in cash is not sufficient to satisfy the tax liability, and the tax is paid before the winnings are released | 393(3) | Rates in force | Rs. 10000 in case of a single transactions |
| 1062 | 194BB | Any income by way of winnings from any horse race | 393(3) | Rates in force | Rs. 10000 in case of a single transactions |
| 1063 | 194G | Any income paid or accrued by way of commission, remuneration or prize (by whatever name called) on those tickets to a person connected with the stock, distribution, purchase or sale of lottery tickets | 393(3) | 2% | 20,000 |
| 1064 | 194N | Any amount of specified payment made in cash to a co-operative society by a bank, post office or co-operative society | 393(3) | 2% | 3 Crore |
| 1065 | 194N | Any amount of specified payment made in cash by a bank, post office or co-operative society to a person other than the co-operative society | 393(3) | 2% | 1 Crore |
| 1066 | 194EE | Any amount referred to in section 80CCA(2)(a) of the Income Tax Act, 1961 | 393(3) | 10% | 2500 |
| 1067 | 194T | Any sum paid by the firm to its partner or credited to his account (including capital account) by way of salary, remuneration, commission, bonus or interest | 393(3) | 10% | 20,000 |
Note: The list given above includes most of the sections applicable to domestic transactions.
Section 397(2) [Earlier Section 206CC]:
According to this provision, every person who receives or pays any amount on which TDS (tax deducted at source) or TCS (tax collected at source) applies is required to provide their PAN (Permanent Account Number) to the individual responsible for deducting or collecting tax.
Situation of not providing PAN:
If PAN is not provided by the person concerned, tax will be deducted at source at the higher rates:
TDS Rate Chart for Foreign
| Codes to be used in return | Old Section | Nature of Payment | TDC Section (IT ACT 2025 | Rates |
| 1004 | 192A | Payment of the outstanding amount deposited by the employee | 392(7) | 10% |
| 1039 | 194E | Any type of income mentioned in section 211 | 393(2) | 20% |
| 1040 | 194LC | Interest income payable relating to foreign currency loans or long-term infrastructure bonds taken between July 1, 2012 and June 30, 2023 | 393(2) | 5% |
| 1041 | 194LD | Interest income payable on amounts borrowed from abroad through rupee-denominated bonds issued before July 1, 2023 | 393(2) | 5% |
| 1042 | 194LC | Interest income payable on long-term or rupee-denominated bonds issued between April 1, 2020 and June 30, 2023, which are listed only on a recognised stock exchange of an International Financial Services Centre | 393(2) | 4% |
| 1043 | 194LC | Interest income payable on long-term or rupee denominated bonds issued on or after July 1, 2023, which are listed only on a recognised stock exchange of an International Financial Services Centre | 393(2) | 9% |
| 1044 | 194LB | Interest income payable to non-residents from infrastructure debt funds | 393(2) | 5% |
| 1045 | 194LBA(a) | Distributed income referred to in section 223, falling under serial number 3. B(a) of the Table of Schedule V | 393(2) | 5% |
| 1046 | 194LBA(b) | Distributed income referred to in section 223, falling under serial number 3. B(b) of the Table of Schedule V | 393(2) | 10% |
| 1047 | 194LBC | Distributed income referred to in section 223 falling under serial number 4 of the Table of Schedule V | 393(2) | Rates in Force |
| 1048 | 194LBB | Income derived from units of investment funds specified in section 224 (other than the portion exempted under Schedule V) | 393(2) | Rates in Force |
| 1049 | 194LBC | Income from investments in securitization trusts referred to in section 221 | 393(2) | Rates in Force |
| 1050 | 195 | Income received from units of a mutual fund specified in Schedule VII or a specified company | 393(2) | 20% |
| 1051 | 196B | Income received from units mentioned in section 208 | 393(2) | 10% |
| 1052 | 196B | Long-term capital gains income derived from the transfer of units referred to in section 208 | 393(2) | 12.50% |
| 1053 | 196C | Income received by way of interest or dividends from bonds or global depository receipts referred to in section 209 | 393(2) | 10% |
| 1054 | 196C | Long-term capital gains income derived from transfer of bonds or global depository receipts referred to in section 209 | 393(2) | 12.50% |
| 1055 | 196D | Income derived from securities mentioned in serial no. 1 of the Table of section 210(1) | 393(2) | 20% |
| 1056 | 196D | Income derived from securities mentioned in serial no. 1 of the Table of section 210(1) | 393(2) | 10% |
| 1057 | 195 | Any other sum or interest payable under this Act (which is not taxable under the head salary), except the interest specified in clauses 2, 3, 4 and 5 | 393(2) | Rates in Force |
| 1058 | 194B | Income from winnings from lotteries, crosswords, card games, any other game, gambling or betting (except as specified) | 393(3) | Rates in force |
| 1059 | 194B | Winnings from the above games or betting where payment is in kind or cash is not sufficient, and tax is paid before the winnings are awarded | 393(3) | Rates in force |
| 1060 | 194BA | Income from any kind of winnings received from online games | 393(3) | Rates in force |
| 1061 | 194BA | Income from winnings received from online games, where the payment in kind or in cash is not sufficient to satisfy the tax liability, and the tax is paid before the winnings are released | 393(3) | Rates in force |
| 1062 | 194BB | Any income by way of winnings from any horse race | 393(3) | Rates in force |
| 1063 | 194G | Any income paid or accrued by way of commission, remuneration or prize (by whatever name called) on those tickets to a person connected with the stock, distribution, purchase or sale of lottery tickets | 393(3) | 2% |
| 1064 | 194N | Any amount of specified payment made in cash to a co-operative society by a bank, post office or co-operative society | 393(3) | 2% |
| 1065 | 194N | Any amount of specified payment made in cash by a bank, post office or co-operative society to a person other than the co-operative society | 393(3) | 2% |
| 1066 | 194EE | Any amount referred to in section 80CCA(2)(a) of the Income Tax Act, 1961 | 393(3) | 10% |
| 1067 | 194T | Any sum paid by the firm to its partner or credited to his account (including capital account) by way of salary, remuneration, commission, bonus or interest | 393(3) | 10% |
TCS Rates Chart
| Codes to be used in return | Old Section | Nature of Payment | TDC Section (IT ACT 2025 | Rates |
| 1068 | 206C – A | Sale of liquor for human consumption | 394(1) | 2% |
| 1069 | 206C – I | Sale of tendu leaves | 394(1) | 2% |
| 1070 | 206C – B | Sale of wood obtained under a forest lease | 394(1) | 2% |
| 1071 | 206C – C | Sale of wood obtained through means other than a forest lease | 394(1) | 2% |
| 1072 | 206C – D | Sale of other forest produce (except wood or tendu leaves) obtained under forest lease | 394(1) | 2% |
| 1073 | 206C – E | Sale of scrap | 394(1) | 2% |
| 1074 | 206C – J | Sale of minerals like coal, lignite or iron ore | 394(1) | 2% |
| 1075 | 206C – L | Sale of motor vehicles, where the selling price exceeds the prescribed limit | 394(1) | 1% |
| 1076 | 206C – MA | Sale of wrist watches, where the selling price exceeds the prescribed limit | 394(1) | 1% |
| 1077 | 206C – MB | Sale of art objects such as antiques, paintings or sculptures, where the selling price exceeds the prescribed limit | 394(1) | 1% |
| 1078 | 206C – MC | The sale of collectable items, such as coins or postage stamps, where the selling price exceeds the prescribed limit | 394(1) | 1% |
| 1079 | 206C – MD | Sale of a yacht, rowing boat, canoe or helicopter, where the sale price exceeds the prescribed limit | 394(1) | 1% |
| 1080 | 206C – ME | Sale of pairs of sunglasses, where the selling price exceeds the prescribed limit | 394(1) | 1% |
| 1081 | 206C – MF | Sale of bags such as handbags or purses, where the selling price exceeds the prescribed limit | 394(1) | 1% |
| 1082 | 206C – MG | The sale of pairs of shoes, where the selling price exceeds the prescribed limit | 394(1) | 1% |
| 1083 | 206C – MH | Sale of sports apparel or equipment, such as golf kits or ski-wear, where the selling price exceeds the prescribed limit | 394(1) | 1% |
| 1084 | 206C – MI | Sale of home theatre systems, where the selling price exceeds the prescribed limit | 394(1) | 1% |
| 1085 | 206C – MJ | Sale of horses for horse racing or polo in a race club, where the selling price exceeds the prescribed limit | 394(1) | 1% |
| 1086 | 206C – T | Foreign remittance of amounts exceeding the limit under the Liberalised Remittance Scheme for the purpose of education or medical treatment | 394(1) | 2% |
| 1087 | 206C – Q | Foreign remittance of amounts exceeding the limit under the Liberalised Remittance Scheme for purposes other than education or medical treatment | 394(1) | 20% |
| 1088 | 206C – O | Sale of foreign travel itinerary packages, including travel, hotel, boarding, lodging or related expenses | 394(1) | 2% |
| 1089 | 206C – O | Sale of foreign travel itinerary packages, including travel, hotel, boarding, lodging or related expenses | 394(1) | 2% |
| 1090 | 206C – F | Right to use parking space for business, except mining of mineral oil (including petroleum and natural gas) | 394(1) | 2% |
| 1091 | 206C – G | Right to use the toll plaza for business, except for the mining of mineral oil | 394(1) | 2% |
| 1092 | 206C – H | The right to use a mine or quarry for business, except for the extraction of mineral oil | 394(1) | 2% |
Note: The list above covers most of the sections applicable to domestic transactions.
Provisions (Section 397(2)/old Section 206CC):
According to this provision, every person who receives or pays any amount on which TCS (Tax Collection at Source) is applicable is required to provide their valid PAN (Permanent Account Number) to the person collecting the tax.
Situation of not providing PAN:
If PAN is not provided by the person concerned, tax will be collected (TCS) at higher rates, but not exceeding 20%:
(A) at twice the rate specified in the relevant provision of this Act; or
(B) at the rate of 5%
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