TDS Rate Chart FY 2025-26 (AY 2026-27) — All Sections + IT Act 2025 Mapping
Complete TDS rate chart FY 2025-26 (AY 2026-27): new 194T 10%, 194H + 194-IB cut to 2%, 206AB removal. IT Act 2025 → Sec 393 mapping for all sections.
Ravi Patel
Editor-in-charge
Last Updated
17 May 2026
Contents
- What’s new in FY 2025-26 (the headline changes)
- Effective dates — when the new rates kick in
- Section 192 — Salary TDS (special case)
- TDS Rate Chart — Resident Payees (full table)
- TDS Rate Chart — Non-Resident Payees (Section 195)
- TCS Rate Chart — Section 206C
- Special cases — PAN not furnished, lower deduction certificates
- Section 206AB + 206CCA removal — what changed
- How to use this chart in practice
IT Act 2025 transition note: This rate chart applies to FY 2025-26 (AY 2026-27) under the Income-tax Act, 1961 — the last cycle under the 1961 Act. From 1 April 2026 (Tax Year 2026-27) the Income-tax Act, 2025 comes into force per Section 536. All non-salary TDS sections (194C, 194J, 194T, 194-I, 194-IB, 195, etc.) are consolidated under Section 393 of the 2025 Act in tabular form; salary TDS sits in Section 392. Rates and thresholds carry forward substantively unchanged but section numbers must be updated on returns and certificates for transactions on or after 1 April 2026. See the IT Act 2025 transition reference for the full section mapping + form mapping (Form 27Q → 144, 15CA → 145, 15CB → 146).
What’s new in FY 2025-26 (the headline changes)
The Finance Act 2025 introduced major rationalisations to the Tax Deducted at Source (TDS) and Tax Collected at Source (TCS) framework to reduce compliance burden and free up working capital.
If you manage a finance team or run payroll, update your ERPs and accounting systems to reflect these headline changes for the new financial year:
- NEW Section 194T: partnership firms and LLPs must now deduct TDS at 10% on remuneration (salary, bonus, commission, interest) paid to partners exceeding ₹20,000 (per Finance (No. 2) Act 2024, effective 1 April 2025).
- Section 194H (commission/brokerage): threshold raised to ₹20,000 (per Finance Act 2025). Rate was earlier cut from 5% to 2% by Finance (No. 2) Act 2024 effective 1 October 2024.
- Section 194-IB (rent by individuals/HUFs): rate previously cut from 5% to 2% by Finance (No. 2) Act 2024 effective 1 October 2024 (unchanged in FY 2025-26).
- Section 194-I (rent thresholds): restructured to a monthly basis of ₹50,000/month for both equipment and property rentals (per Finance Act 2025). Replaces the earlier ₹2,40,000 annual aggregate threshold.
- Section 194A (senior citizen interest): threshold for TDS on bank / post office interest for senior citizens doubled to ₹1,00,000; non-senior bank interest raised to ₹50,000 (per Finance Act 2025).
- Section 194D / 194G (insurance + lottery commission): thresholds raised to ₹20,000 (from ₹15,000) (per Finance Act 2025).
- Section 194J (professional / technical fees): threshold raised to ₹50,000 per nature of payment (from ₹30,000) (per Finance Act 2025).
- Section 194LA (compulsory land acquisition): threshold raised to ₹5,00,000 (from ₹2,50,000) (per Finance Act 2025).
- Section 194LBC (securitisation trust): rate reduced to a flat 10% (per Finance Act 2025).
- Sections 206AB + 206CCA REMOVED: deductors no longer need to penalise non-ITR filers with higher withholding rates (per Finance Act 2025).
Effective dates — when the new rates kick in
The TDS rates, modified thresholds, and new sections outlined in this chart apply to all payments or credits made on or after 1 April 2025 (i.e., for Financial Year 2025-26 = Assessment Year 2026-27).
Section 192 — Salary TDS (special case)
Unlike other TDS sections that operate on flat percentages, Section 192 (TDS on salary) operates on average slab rates. Employers must estimate the employee’s total income for the year, calculate applicable tax according to the employee’s chosen regime (the new regime is the default), and deduct the resulting liability in equal monthly instalments.
For the exact slab rates and ₹60,000 Section 87A rebate mechanics for FY 2025-26, see the Income Tax overview.
TDS Rate Chart — Resident Payees (full table)
| Section | Nature of payment | Threshold (FY 2025-26) | TDS rate | Notes |
|---|---|---|---|---|
| 192 | Salary | Basic exemption limit | Slab rate | Regime-aware (new/old) |
| 192A | Premature EPF withdrawal | ₹50,000 | 10% | 20% if PAN missing |
| 193 | Interest on securities | ₹10,000 | 10% | |
| 194 | Dividends | ₹5,000 | 10% | |
| 194A | Interest (banks, co-ops, post office) | ₹50,000 (ind) / ₹1,00,000 (senior) | 10% | Senior threshold doubled (per Finance Act 2025) |
| 194A | Interest from others (unsecured loans) | ₹10,000 | 10% | |
| 194B | Lottery / puzzles | ₹10,000 | 30% | |
| 194BA | Online game winnings | No threshold | 30% | Calculated on net winnings |
| 194BB | Horse race winnings | ₹10,000 | 30% | |
| 194C | Contractor / sub-contractor | ₹30,000 single / ₹1,00,000 FY | 1% (ind/HUF) / 2% (other) | |
| 194D | Insurance commission | ₹20,000 | 5% | Threshold raised (per Finance Act 2025) |
| 194DA | LIC maturity (income portion) | ₹1,00,000 | 5% | Only on taxable income component |
| 194E | Sportsmen / sports association (NR) | No threshold | 20% | |
| 194G | Lottery ticket commission | ₹20,000 | 5% | Threshold raised (per Finance Act 2025) |
| 194H | Commission / brokerage | ₹20,000 | 2% | Rate cut + threshold raised (per Finance Act 2025) |
| 194-I(a) | Rent — plant / machinery / equipment | ₹50,000 per month (₹6,00,000 annual) | 2% | Monthly threshold shift (per Finance Act 2025) |
| 194-I(b) | Rent — land / building / furniture | ₹50,000 per month (₹6,00,000 annual) | 10% | Monthly threshold shift (per Finance Act 2025) |
| 194-IA | Immovable property purchase (non-agri) | ₹50,00,000 | 1% | On higher of consideration or stamp value |
| 194-IB | Rent paid by ind/HUF (non-audit) | ₹50,000 per month | 2% | Rate cut from 5%. Deduct in last month of FY / tenancy |
| 194-IC | Joint Development Agreement | No threshold | 10% | |
| 194J(a) | Royalties / technical fees / call centre | ₹50,000 | 2% | Threshold raised (per Finance Act 2025) |
| 194J(b) | Professional services / director fees | ₹50,000 | 10% | No threshold for director sitting fees. Threshold raised (per Finance Act 2025) |
| 194K | Income from mutual funds | ₹10,000 | 10% | |
| 194LA | Compulsory property acquisition | ₹5,00,000 | 10% | Threshold raised (per Finance Act 2025) |
| 194LBA | Income from business trust | Various | Varies | Rate depends on nature of income distributed |
| 194LBB | Investment fund income | Various | Varies | |
| 194LBC | Securitisation trust income | No threshold | 10% | Reduced (per Finance Act 2025) |
| 194LD | Interest to FII (rupee bonds) | No threshold | 5% | |
| 194M | Contractor / commission / professional by ind/HUF (non-audit) | ₹50,00,000 annual | 2% | Reduced from 5% to 2% effective 1 October 2024 per Finance (No. 2) Act 2024 |
| 194N | Cash withdrawal | > ₹1 crore | 2% | |
| 194N | Cash withdrawal (ITR non-filer) | ₹20L to ₹1cr / > ₹1cr | 2% / 5% | |
| 194O | E-commerce operator → participant | ₹5,00,000 | 0.1% | |
| 194P | Super senior (75+) bank pension + interest | Basic exemption | Slab rates | Bank files return on behalf of senior citizen |
| 194Q | Purchase of goods (buyer turnover > ₹10cr) | ₹50,00,000 | 0.1% | |
| 194R | Business benefits / perquisites | ₹20,000 | 10% | |
| 194S | Virtual Digital Assets (crypto transfer) | ₹10,000 / ₹50,000 | 1% | |
| 194T | Partnership firm / LLP → partner (salary, bonus, commission, interest) | ₹20,000 | 10% | NEW section (per Finance (No. 2) Act 2024, effective 1 April 2025) |
TDS Rate Chart — Non-Resident Payees (Section 195)
When making payments to Non-Resident Indians (NRIs) or foreign companies, Section 195 applies. TDS is generally deducted at the rates in force or the rate provided in the Double Taxation Avoidance Agreement (DTAA), whichever is more beneficial to the payee.
To claim DTAA benefits, the non-resident must furnish a Tax Residency Certificate (TRC) and Form 10F.
- Long-Term Capital Gains (LTCG) on listed equity (Sec 112A): 12.5%
- Short-Term Capital Gains (STCG) on listed equity (Sec 111A): 20%
- LTCG on other assets: 12.5%
- Interest (general): 20%
- Interest on specified bonds / loans (Sec 194LC, 194LD): 5%
- Royalty / Fees for Technical Services (FTS): 20% (or DTAA rate if lower)
- Other income: as per the Income Tax Act or applicable DTAA (whichever is lower)
TCS Rate Chart — Section 206C
Tax Collected at Source (TCS) obligates the seller to collect tax from the buyer at the time of sale.
| Sub-section | Item / nature of receipt | TCS rate | Threshold limit |
|---|---|---|---|
| 206C(1) | Alcoholic liquor for human consumption | 1% | None |
| 206C(1) | Tendu leaves | 5% | None |
| 206C(1) | Timber and other forest produce | 2.5% | None |
| 206C(1) | Scrap | 1% | None |
| 206C(1) | Minerals (coal, lignite, iron ore) | 1% | None |
| 206C(1F) | Sale of motor vehicle | 1% | Values exceeding ₹10,00,000 |
| 206C(1G) | LRS — overseas tour package | 5% / 20% | Up to ₹7L / above ₹7L |
| 206C(1G) | LRS — education (loan-funded) | 0.5% | Above ₹7L |
| 206C(1G) | LRS — education / medical (other than loan) | 5% | Above ₹7L |
| 206C(1G) | LRS — general purpose (investments, etc.) | 20% | Above ₹7L |
| 206C(1H) | Sale of goods (by seller with > ₹10cr turnover) | 0.1% | Receipts exceeding ₹50,00,000 |
Special cases — PAN not furnished, lower deduction certificates
Section 206AA (PAN not furnished): If the deductee does not provide their PAN or Aadhaar number, the deductor must withhold tax at a flat rate of 20%, or the applicable statutory rate, whichever is higher.
Section 197 (lower deduction certificate): If a deductee provides a formal certificate issued by their Assessing Officer under Section 197 (applied via Form 13), the deductor must withhold TDS strictly at the reduced rate specified in the certificate, rather than the standard rates above.
Section 206AB + 206CCA removal — what changed
Historically, Sections 206AB and 206CCA forced deductors to check a specialised portal to determine if the payee had filed their Income Tax Returns for previous years. If the payee was marked as a “specified person” (non-filer), the deductor had to apply penal TDS/TCS rates (usually double the normal rate, or 5%, whichever was higher).
To dramatically ease the compliance burden, these sections have been entirely REMOVED (per Finance Act 2025) effective 1 April 2025. You no longer need to perform compliance background checks on your vendors before processing payments — simply deduct tax at the standard rates in this chart.
How to use this chart in practice
For finance teams and accounts payable departments, follow this 4-step workflow:
- Identify the payment: determine the exact nature of the service or supply (e.g., is it a professional service under 194J or a contract under 194C?).
- Check the threshold: track aggregate payments to that specific vendor/PAN over the financial year. Tax is only deducted once the threshold is crossed.
- Apply the rate: calculate TDS on the exact invoice amount (exclusive of GST, as per CBIC circulars, if GST is shown separately).
- Deposit and file: deposit the deducted amount to the Government using Challan ITNS 281 by the 7th of the following month, and file the appropriate quarterly statement (Form 24Q, 26Q, or 27Q).
For execution support, see the TDS Return Filing service. For full mechanics, see the TDS overview pillar.
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Ravi Patel
Founder & CEO, BatchWise
Having navigated Indian compliance for years, Ravi created BatchWise to bridge the gap between "DIY AI slop" software and expensive traditional firms. He ensures SMEs and foreign subsidiaries have reliable, expert guidance without the friction.