A comprehensive comparative guide to updated TCS rates, sections, and compliance changes under the Income-tax Act, 2025 for FY 2026-27.
Khush Dharmeshkumar Trivedi | May 6, 2026 |
TCS Rate Chart as per Income-tax Act 2025 for Tax Year 2026-27
As we all are aware, w.e.f. 1st April 2026, the New Income Tax Act 2025 will be applicable, under which there are significant changes in section numbering & rearranging; hence, it’s very crucial to understand the provisions in alignment with the traditional act, i.e., the Income Tax Act 1961, & if you are looking for such a comparative analysis, then this article is for you
NEW TCS RATE CHART: (F.Y. 2026-27)
| Old Section (IT Act 1961) | Nature of Collection | New Section (IT Act 2025) | PERSON | TCS Rate | Threshold / Remarks |
| GOODS SPECIFIED CATEGORIES (Sec 394(1)) | |||||
| 206C(1) | Sale of Alcoholic Liquor for Human Consumption | 394(1) [Sl. 1] | SELLER | 2% | |
| 206C(1) | Sale of Tendu Leaves | 394(1) [Sl. 2] | SELLER | 2% | |
| 206C(1) | Sale of Timber obtained under Forest Lease | 394(1) [Sl. 3] | SELLER | 2% | |
| 206C(1) | Sale of Timber obtained by mode other than Forest Lease | 394(1) [Sl. 3] | SELLER | 2% | |
| 206C(1) | Sale of other Forest Produce (not timber or tendu leaves) | 394(1) [Sl. 3] | SELLER | 2% | |
| 206C(1) | Sale of Scrap | 394(1) [Sl. 4] | SELLER | 2% | |
| 206C(1) | Sale of Minerals — Coal, Lignite or Iron Ore | 394(1) [Sl. 5] | SELLER | 2% | |
| LUXURY GOODS (Sale consideration exceeding threshold — Sec 394(1) [Sl. 6]) | |||||
| 206C(1F) | Sale of Motor Vehicle | 394(1) [Sl. 6.D(a)] | SELLER | 1% | Threshold as notified, i.e., 10 Lakh |
| Notified Luxury Item | Sale of a wrist watch | 394(1) [Sl. 6.D(b)] | SELLER | 1% | Above threshold limit |
| Notified Luxury Item | Sale of Art Pieces (Antiques, Paintings, Sculpture) | 394(1) [Sl. 6.D(b)] | SELLER | 1% | Above threshold limit |
| Notified Luxury Item | Sale of Collectables (Coin, Stamp) | 394(1) [Sl. 6.D(b)] | SELLER | 1% | Above threshold limit |
| Notified Luxury Item | Sale of Yacht, Rowing Boat, Canoe, Helicopter | 394(1) [Sl. 6.D(b)] | SELLER | 1% | Above threshold limit |
| Notified Luxury Item | Sale of Pair of Sunglasses | 394(1) [Sl. 6.D(b)] | SELLER | 1% | Above threshold limit |
| Notified Luxury Item | Sale of Bag (Handbag, Purse) | 394(1) [Sl. 6.D(b)] | SELLER | 1% | Above threshold limit |
| Notified Luxury Item | Sale of Pair of Shoes | 394(1) [Sl. 6.D(b)] | SELLER | 1% | Above threshold limit |
| Notified Luxury Item | Sale of Sportswear & Equipment (Golf Kit, Ski-wear) | 394(1) [Sl. 6.D(b)] | SELLER | 1% | Above threshold limit |
| Notified Luxury Item | Sale of Home Theatre System | 394(1) [Sl. 6.D(b)] | SELLER | 1% | Above threshold limit |
| Notified Luxury Item | Sale of Horse (for racing in race clubs/polo) | 394(1) [Sl. 6.D(b)] | SELLER | 1% | Above threshold limit |
| LIBERALISED REMITTANCE SCHEME (LRS) & OVERSEAS TOURS | |||||
| 206C(1G) | LRS Remittance for Education / Medical Treatment (above threshold – 10 lakh) | 394(1) [Sl. 7.D(a)] | Authorized Dealer | 2% | |
| 206C(1G) | LRS Remittance for purposes other than Education / Medical | 394(1) [Sl. 7.D(b)] | Authorized Dealer | 20% | Higher rate for other LRS remittances |
| 206C(1G) | Sale of Overseas Tour Programme Package (any operator) | 394(1) [Sl. 8.D(a)] | Authorized Dealer | 2% | |
| 206C(1G) | Sale of Overseas Tour Package (another category) | 394(1) [Sl. 8.D(b)] | Authorized Dealer | 2% | |
| LEASING / USE RIGHTS (Section 394(1) [Sl. 9]) | |||||
| 206C(1C) | Use of Parking Lot (business purpose, excl. mineral oil mining) | 394(1) [Sl. 9] | Licensor or Lessor. | 2% | |
| 206C(1C) | Use of Toll Plaza (business purpose, excl. mineral oil mining) | 394(1) [Sl. 9] | Licensor or Lessor. | 2% | |
| 206C(1C) | Use of Mine or Quarry (business purpose, excl. mineral oil) | 394(1) [Sl. 9] | Licensor or Lessor. | 2% | |
PAN COMPLIANCE CHANGES: 206CC (TCS — PAN) → 397(2)
Higher of 2x rate or 5%
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