A complete and updated overview of TDS rates, revised sections, and key compliance changes under the Income-tax Act, 2025 applicable from FY 2026-27.
Khush Dharmeshkumar Trivedi | May 6, 2026 |
TDS Rate Chart as per Income-tax Act 2025 for Tax Year 2026-27
In Today’s evolving time, the knowledge of tax deducted at source is a must. The government plays a crucial role in collecting the TDS on a timely basis and generating revenue. If you are professionals, students, industrialists, or businessmen, then you very well know that there is a huge change in the Income Tax Act which is applicable from 1st April, 2026, and shall apply from Tax Year 2026-27 onwards. The major changes in TDS sections include restructuring of existing provisions and alignment of rates.
NEW TDS RATE CHART: (F.Y. 2026-27)
For Payments to Resident
| Old Section (IT Act 1961) | Nature of Payment | New Section (IT Act 2025) | Rate | Threshold Limit | Remarks |
| SALARY & PF | |||||
| 192 | Payment of Salary to Employees | 392 | Slab Rates | Basic Exemption Limit | As per the applicable income tax slabs |
| 192A | Accumulated PF balance paid to employee (premature) | 392(7) | 10% | ₹50,000 | 10% if PAN furnished; else 20% (Sec 397) |
| RENT | |||||
| 194I(a) | Rent — Plant, Machinery, Equipment (Specified Person) | 393(1) [Sl. 2(ii).D(a)] | 2% | ₹50,000 p.m. | Specified person = company/ firm/ LLP etc. |
| 194I(b) | Rent — Land, Building, Furniture (Specified Person) | 393(1) [Sl. 2(ii).D(b)] | 10% | ₹50,000 p.m. | Specified person = company/ firm/ LLP etc. |
| 194-IB | Rent paid by Individual/HUF (not subject to audit) | 393(1) [Sl. 2(i)] | 2% | ₹50,000 p.m. | Applicable to Individuals/HUF payers |
| COMMISSION & BROKERAGE | |||||
| 194D | Commission/Brokerage — Insurance | 393(1) [Sl. 1(i)] | Rates in force | ₹20,000 | Rate as per Slab / applicable rate |
| 194H | Commission/Brokerage — Others | 393(1) [Sl. 1(ii)] | 2% | ₹20,000 | |
| IMMOVABLE PROPERTY | |||||
| 194-IA | Transfer of Immovable Property (buyer deducts) | 393(1) [Sl. 3(i)] | 1% | ₹50 Lakh | |
| 194IA | Compensation on Acquisition of Certain Immovable Property | 393(1) [Sl. 3(iii)] | 1% | ₹50 Lakh | Compulsory acquisition by Govt |
| 194IC | Payment under JDA (not in kind) u/s 67(14) | 393(1) [Sl. 3(ii)] | 10% | — | Joint Development Agreement payments |
| MUTUAL FUND / TRUST / INVESTMENT FUND | |||||
| 194K | Income from Mutual Fund Units / Specified Undertaking | 393(1) [Sl. 4(i)] | 10% | ₹10,000 | |
| 194LBA | Interest income from Business Trust units (Resident) | 393(1) [Sl. 4(ii)] | 10% | — | |
| 194LBA | Dividend income from Business Trust units (Resident) | 393(1) [Sl. 4(ii)] | 10% | — | |
| 194LBB | Income from Investment Fund units u/s 224 | 393(1) [Sl. 4(iii)] | 10% | — | Excludes exempt portion under Schedule V |
| 194LBC | Income from Securitisation Trust u/s 221 | 393(1) [Sl. 4(iv)] | 10% | — | |
| INTEREST | |||||
| 193 | Interest on Securities | 393(1) [Sl. 5(i)] | Rates in force | ₹10,000 | |
| 194A | Interest (other than on securities) — Senior Citizen | 393(1) [Sl. 5(ii).D(a)] | Rates in force | ₹1,00,000 | Higher threshold for senior citizens |
| 194A | Interest (other than on securities) — Others | 393(1) [Sl. 5(ii).D(b)] | Rates in force | ₹50,000 | |
| 194A | Any other interest (non-securities) | 393(1) [Sl. 5(iii)] | Rates in force | ₹10,000 | |
| CONTRACTS & PROFESSIONAL FEES | |||||
| 194C | Work Contract — Individual / HUF contractor | 393(1) [Sl. 6(i).D(a)] | 1% | ₹30,000 (Single) / ₹1 Lakh (Aggregate) | |
| 194C | Work Contract — Other than Individual/HUF | 393(1) [Sl. 6(i).D(b)] | 2% | ₹1 Lakh (Aggregate) | |
| 194M | Payments by Ind/HUF (not in audit) for Contract/Prof Fees | 393(1) [Sl. 6(ii)] | 2% | ₹50 Lakh | |
| 194J(a) | Fees for Technical Services (non-professional) / Royalty for films / Call Centre | 393(1) [Sl. 6(iii).D(a)] | 2% | ₹50,000 | |
| 194J(b) | Fees for Professional Services / Sum u/s 26(2)(h) | 393(1) [Sl. 6(iii).D(b)] | 10% | ₹50,000 | |
| 194J(b) | Remuneration / Fees / Commission to Director (non-salary) | 393(1) [Sl. 6(iii).D(b)] | 10% | — | No threshold |
| DIVIDENDS | |||||
| 194 | Dividends declared (including preference shares) — Resident | 393(1) [Sl. 7] | 10% | — | |
| LIFE INSURANCE / GOODS / E-COMMERCE / VDA | |||||
| 194DA | Life insurance policy maturity amount (net of exempt) | 393(1) [Sl. 8(i)] | 2% | ₹1 Lakh | On net amount (after Schedule II deduction) |
| 194Q | Purchase of Goods | 393(1) [Sl. 8(ii)] | 0.1% | In excess of ₹50 Lakh | Buyer deducts on purchase amount |
| 194R | Business Perquisite / Benefit (cash or kind) | 393(1) [Sl. 8(iv)] | 10% | ₹20,000 | |
| 194R | Perquisite in kind where cash is insufficient to cover tax | 393(1) [Sl. 8(iv)] | 10% | ₹20,000 | Tax must be paid before release (Note 3) |
| 194O | E-commerce: Sale of goods/services via an operator platform | 393(1) [Sl. 8(v)] | 0.1% | — | |
| 194S | VDA Transfer — by a person other than Ind/HUF | 393(1) [Sl. 8(vi)] | 1% | — | Crypto / Virtual digital assets |
| 194SP | VDA Transfer — any person (cash or kind, or partly) | 393(1) [Sl. 8(vi)] | 1% | — | Note 4 applies: tax before release |
| WINNINGS, LOTTERY / GAMES / HORSE RACE | |||||
| 194B | Winnings: Lottery, Crossword, Card Games, Gambling | 393(3) [Sl. 1] | Rates in force | ₹10,000 per transaction | |
| 194B | Above winnings – in kind/cash insufficient (tax paid first) | 393(3) [Sl. 1] | Rates in force | ₹10,000 per transaction | Note 1 |
| 194BA | Winnings from Online Games | 393(3) [Sl. 2] | Rates in force | Net winnings at year end | On the user account balance |
| 194BA | Online game winnings in kind/cash are insufficient | 393(3) [Sl. 2] | Rates in force | ₹10,000 per transaction | Note 2 |
| 194BB | Winnings from Horse Race | 393(3) [Sl. 3] | Rates in force | ₹10,000 per transaction | |
| LOTTERY COMMISSION / CASH WITHDRAWALS / PARTNERS / NSS | |||||
| 194G | Commission on Lottery Tickets (to stockists/distributors) | 393(3) [Sl. 4] | 2% | ₹20,000 | |
| 194N | Cash withdrawal by Co-operative Society from bank/PO | 393(3) [Sl. 5.D(a)] | 2% | ₹3 Crore | |
| 194N | Cash withdrawal by other persons from bank/PO | 393(3) [Sl. 5.D(b)] | 2% | ₹1 Crore | |
| 194EE | NSS Deposit withdrawal [Sec 80CCA(2)(a) of IT Act 1961] | 393(3) [Sl. 6] | 10% | ₹2,500 | |
| 194T | Payments to Partner — Salary, Remuneration, Commission, Bonus, Interest | 393(3) [Sl. 7] | 10% | ₹20,000 | New section in IT Act 2025 |
For Payments to Non-Resident
| Old Section (IT Act 1961) | Nature of Payment | New Section (IT Act 2025) | Rate | Remarks |
| 194E | Income of Non-Resident Sportsmen/Associations u/s 211 | 393(2) [Sl. 1] | 20% | |
| 194LC | Interest on foreign currency borrowings (loan/LT infra bond Jul 2012–Jun 2023; LT bond Oct 2014–Jun 2023 — Govt approved) | 393(2) [Sl. 2] | 5% | |
| 194LD | Interest on rupee-denominated bond issued before 1-Jul-2023 (borrowed outside India) | 393(2) [Sl. 3] | 5% | |
| 194LC | Interest on LT bond/rupee bond listed on IFSC exchange — issued 1-Apr-2020 to 30-Jun-2023 | 393(2) [Sl. 4.E(a)] | 4% | IFSC = International Financial Services Centre |
| 194LC | Interest on LT bond/rupee bond listed on IFSC exchange — issued on/after 1-Jul-2023 | 393(2) [Sl. 4.E(b)] | 9% | |
| 194LB | Interest from Infrastructure Debt Fund payable to Non-Resident | 393(2) [Sl. 5] | 5% | |
| 194LBA(a) | Distributed income of nature under Sch V [Sl. 3.B(a)] from Business Trust to NR | 393(2) [Sl. 6.E(a)] | 5% | |
| 194LBA(b) | Distributed income of nature under Sch V [Sl. 3.B(b)] from Business Trust to NR | 393(2) [Sl. 6.E(b)] | 10% | |
| 194LBC | Distributed income of nature under Sch V [Sl. 4] to NR | 393(2) [Sl. 7] | Rates in force | |
| 194LBB | Income from Investment Fund u/s 224 (excl. exempt portion u/s Sch V [Sl. 2]) | 393(2) [Sl. 8] | Rates in force | |
| 194LBC | Income from Securitisation Trust u/s 221 | 393(2) [Sl. 9] | Rates in force | |
| 195 | Income re: Mutual Fund units [Sch VII Sl. 20/21] or from the specified company | 393(2) [Sl. 10] | 20% | |
| 196B | Income from Offshore Fund unit’s u/s 208 | 393(2) [Sl. 11] | 10% | |
| 196B | LTCG on transfer of Offshore Fund unit’s u/s 208 | 393(2) [Sl. 12] | 12.5% | |
| 196C | Interest / Dividends on bonds or Global Depository Receipts u/s 209 | 393(2) [Sl. 13] | 10% | |
| 196C | LTCG on transfer of bonds or GDRs u/s 209 | 393(2) [Sl. 14] | 12.5% | |
| 196D | Income (not dividend/CG) of FIIs/FPIs from securities u/s 210(1) | 393(2) [Sl. 15] | 20% | |
| 196D | Dividend income of FIIs/FPIs from securities u/s 210(1) | 393(2) [Sl. 16] | 10% | |
| 195 | Any other interest/sum chargeable under the Act (not salary: not covered above) | 393(2) [Sl. 17] | Rates in force |
KEY COMPLIANCE CHANGES:
Section 194T (Now under section 393)
TDS @ 10% on Payment to Partner (Interest, remuneration, Bonus) if the amount exceeding 20,000 is now included under the new Income tax act.
Quoting Sections
From 01-04-2026, you shall mention the serial number of the section of the old section (like 194J, 194C…), not accepted on the portal.
Consolidation of Rates
The New Income tax simplified the rates on e-commerce transactions, certain rent payments, and insurance commission (reduced from 5% to 2%).
206AA (PAN non-compliance) → 397(2)
20% if no PAN for most sections & Lower 5% TDS rate for goods purchased and e-commerce where PAN is missing.
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