TDS on Payment to Resident under Income Tax Act, 2025
[With effect from 1st April, 2026 (Section – 393, Income-Tax Act, 2025 – 2025)]
- (1) Where any income or sum of the nature specified in column B of the Table below is credited or paid or distributed by the person specified in column C during the tax year, to a resident, the person responsible for paying such income or sum shall deduct income-tax, —
| (a) |
on the entire amount of such income or sum, where the amount or aggregate of amounts exceeds the threshold limit specified in column D, or on sum as per Note 1 for serial number 8(ii), as the case may be; |
| (b) | at the rate specified in column D; |
| (c) | at the time of credit of such income or sum to the account of the payee or at the time of its payment in cash or by way of a cheque or a draft or by any other mode, whichever is earlier; and |
| (d) | subject to the provisions of sub-sections (4), (5), (6), (8) and (9). |
TABLE
FOR PAYMENTS TO RESIDENT
| Sl. No. | Nature of Income or sum | Payer | Rate | ||||||||||||||||||||||||||||||||||||
| Threshold limit | |||||||||||||||||||||||||||||||||||||||
| A | B | C | D | ||||||||||||||||||||||||||||||||||||
| 1. Commission or brokerage | |||||||||||||||||||||||||||||||||||||||
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(i) Any income by way of remuneration or reward, whether by way of commission or otherwise, for soliciting or procuring insurance business (including business relating to the continuance, renewal or revival of insurance policies). |
Any person. |
Rate: Rates in force. ___________ Threshold limit: ₹ 20,000. |
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| (ii) Any income by way of commission [not being insurance commission referred to in serial number 1(i)] or brokerage. | Specified person. | Rate: 2%
________ Threshold limit: ₹ 20,000. |
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| 2. Rent | |||||||||||||||||||||||||||||||||||||||
| (i) Any income by way of rent. | Person other than the specified person. | Rate: 2%
________ Threshold limit: ₹ 50,000 for a month or part of a month. |
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| (ii) Any income by way of rent. | Specified person. |
Rate: (a) 2%, for the use of any machinery or plant or equipment; and (b) 10%, for the use of any land, or building (including factory building), or land appurtenant to a building (including factory building), or furniture, or fittings. __________ Threshold limit [for (a) and (b)]: ₹ 50,000 for a month or part of a month. |
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Note 1.-In serial number 2(i), the tax shall be deducted on such income at the time of—
whichever is earlier, for the last month of the tax year or the last month of tenancy. |
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| 3. Payment on transfer of certain immovable property other than agricultural land | |||||||||||||||||||||||||||||||||||||||
| (i) Any consideration for the transfer of any immovable property (other than agricultural land). | Person [other than the person who is required to deduct tax under serial number 3(iii)]. | Rate: 1% of—
whichever is higher. _________ Threshold limit: Fifty lakh rupees, as per Note 3. |
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| (ii) Any consideration, not being consideration in kind, under the agreement referred to in section 67(14). | Any person. | Rate: 10%
__________ Threshold limit: Nil. |
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| (iii) Any sum, being in the nature of—
(a) compensation or the enhanced compensation; or (b) consideration or the enhanced consideration, on account of compulsory acquisition, under any law for the time being in force, of any immovable property (other than agricultural land). |
Any person. | Rate: 10%
__________ Threshold limit: ₹ 5,00,000. |
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| Note 1.-Consideration for transfer of any immovable property under serial number 3(i) shall be the aggregate of the amounts paid or payable by all the transferees to the transferor or all the transferors for transfer of such immovable property for the purposes of the threshold limit mentioned in column D.
Note 2.– In case of consideration on which provisions of both serial numbers 3(i) and 3(ii) are applicable, tax shall be deducted under 3(ii) only. Note 3.– For the purposes of serial number 3(iii), the income-tax shall be deducted where the consideration for transfer of any immovable property or the stamp duty value of such property is equal to or greater than fifty lakh rupees. |
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| 4. Income from capital market | |||||||||||||||||||||||||||||||||||||||
| (i) Any income in respect of-
(a) Units of a Mutual Fund specified under Schedule VII (Table: Sl. No. 20 or 21); or (b) Units from the Administrator of the specified undertaking; or (c) Units from the specified company. |
Any person. | Rate: 10%
Threshold limit: ₹ 10,000. |
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| (ii) Any distributed income referred to in section 223, being of the nature referred to in Schedule V (Table: Sl. Nos. 3 and 4), payable to a unitholder of a Business Trust. | Any Business Trust | Rate: 10%
____________ Threshold limit: Nil. |
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| (iii) Any income, other than that proportion of income which is exempt under Schedule V (Table: Sl. No. 2), in respect of units of an investment fund specified in section 224, payable to its unitholder | Any Investment fund specified in section 224 | Rate: 10%
_________ Threshold limit: Nil. |
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| (iv) Any income, in respect of an investment in a securitization trust specified in section 221 to an investor. | Any securitization trust specified in section 221 | Rate: 10%
________ Threshold limit: Nil. |
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| 5. Interest income | |||||||||||||||||||||||||||||||||||||||
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Any person. | Rate: Rates in force.
_________ Threshold limit: ₹ 10,000. |
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Rate: Rates in force.
_______ Threshold limit:
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Specified person [other than person in Sl. No. 5 (ii). C]. | Rate: Rates in force.
_______ Threshold limit: ₹ 10,000. |
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Note 1.-In serial number 5(ii) and (iii), where the interest income credited or paid is in respect of—
Note 2.-The person responsible for making the payment referred to in serial number 5(ii) and (iii) of this Table, may at the time of making any deduction, increase or reduce the amount to be deducted for the purpose of adjusting any excess or deficiency arising out of any previous deduction or failure to deduct during the tax year. |
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| 6. Payments to contractors, fees for professional and technical services, etc. | |||||||||||||||||||||||||||||||||||||||
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Any designated person. | Rate: (a) 1%, if contractor is individual or Hindu undivided family;
(b) 2%, if contractor is a person other than the person mentioned in (a). _____ Threshold limit: [for (a)and (b)]
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Any person, being an individual or Hindu undivided family [other than those required to deduct income-tax as per Sl. No. 6(i) and (iii) or Sl. No. 1(ii)]. | Rate: 2%
_____ Threshold limit: Fifty lakh rupees. |
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Specified person. | Rate: (a) 2% of such sum in case of—
(b) 10% of such sum in cases other than (a). _____ Threshold limit: (i) for (a), (b), (d) and (e) of Col. B: ₹ 50,000. (ii) for (c) of Col. B: Nil. |
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Note. -In serial number 6(i), if any sum is paid or credited for carrying out any work specified in section 402(47)(e), tax shall be deducted at source—
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| 7. Dividend | |||||||||||||||||||||||||||||||||||||||
| Any dividend (including dividend on preference shares) declared. | Any domestic company. | Rate: 10%
_______ Threshold limit: Nil. |
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| Note. —The tax shall be deducted at source before making any distribution or payment of dividend. | |||||||||||||||||||||||||||||||||||||||
| 8. Other cases | |||||||||||||||||||||||||||||||||||||||
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Any person. | Rate: 2% on income comprised in such sum.
_______ Threshold limit: ₹ 1,00,000. |
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Any person, being a buyer. | Rate: 0.1%
_____ Threshold limit: As per Note 1. |
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Specified bank. | Rate: Rates in force.
_____ Threshold limit: As applicable. |
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Specified person. | Rate: 10% of value or aggregate of values of such benefit or perquisite.
_____ Threshold limit: ₹ 20,000. |
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Any e-commerce operator. | Rate: 0.1% of gross amount of such sale or services or both.
_____ Threshold limit: Nil. |
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Any person. | Rate: 1%
_____ Threshold limit: Nil. |
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Note 1. -(a) The deduction of tax under serial number 8(ii) shall not apply to a transaction on which tax is deductible or collectible under any of the provisions of the Act.
(b)The tax shall be deducted on the sum exceeding fifty lakh rupees.
Note 2.-The provisions of serial number 8(iv) shall also apply to any benefit or perquisite, whether in cash or in kind or partly in cash and partly in kind, provided to a resident and before providing such benefit or perquisite, as the case may be, the person responsible for providing such benefit or perquisite shall ensure that tax has been deducted.
Note 3.-In respect of serial number 8(v)—
| (a) | for deduction of tax, the provisions thereof shall take precedence over any other provisions of this Chapter; |
| (b) | any payment made by a purchaser of goods or recipient of services directly to an e-commerce participant for the sale of goods or provision of services or both, facilitated by an e-commerce operator, shall be deemed to be the amount credited or paid by the e-commerce operator to the e-commerce participant and this amount shall be included in the gross amount of such sale or services for the purposes of deduction of income-tax under this serial number; |
| (c) | e-commerce operator shall be deemed to be the person responsible for paying to e-commerce participant; |
| (d) | irrespective of anything contained in this Chapter, if— |
| (i) | tax has been deducted on a transaction under this serial number; or |
| (ii) | a transaction is not liable for tax deduction as provided in section 393(4) (Table: Sl. No. 11), |
| then tax shall not be deducted on such transaction under any other provision of this Chapter; | |
| (e) | clause (d) shall not apply to any amount or aggregate of amounts received or receivable by an e-commerce operator for— |
| (i) | hosting advertisements; or |
| (ii) | providing any other services, |
| which are not in connection with the sale or services referred to in this serial number. |
Note 4.—In case of a transaction on which provisions of serial number 8(v) are applicable along with the provisions of serial number 8(vi) for deduction of tax, then irrespective of anything contained in Note 3, tax on such transaction shall be deducted only under the provisions of serial number 8(vi).
Note 5.—The provisions of serial number 8(iii) shall take precedence over any other provisions of this Chapter and tax shall be deducted under this provision.
Note 6.—For serial number 8(iv) and (vi), —
| (a) | where the consideration or, benefit or perquisite provided, as the case may be, — |
| (i) | is in exchange of another virtual digital asset where there is no part in cash, in respect of serial number 8(iv); or |
| (ii) | is wholly in kind; or |
| (iii) | is partly in kind and partly in cash, but such part in cash is not sufficient to meet the liability of deduction of tax in respect of the whole of such payment or benefit or perquisite, |
| the person responsible for paying or providing shall ensure that the tax required to be deducted has been paid, before releasing such consideration or providing such benefit or perquisite, as the case may be; | |
| (b) | “Person responsible for providing” means the person providing such benefit or perquisite, or in case of a company, the company itself, including the principal officer thereof. |
(2) Where any income or sum of the nature specified in column B of the Table below is credited or paid by the person specified in column D during the tax year, to a non-resident specified in column C, the person responsible for paying such income or sum shall deduct income-tax on the amount of such income or sum, —
| (a) | at the rate specified in column E; |
| (b) | at the time of credit of income or sum to the account of the payee or at the time of its payment in cash or by way of a cheque or a draft or by any other mode, whichever is earlier; and |
| (c) | subject to the provisions of sub-sections (4), (8) and (9). |
