RATES OF TDS & SURCHARGE IN CASE OF A PERSON OTHER THAN A COMPANY
(Finance Bill, 2026)
[With effect from 1st April, 2026]
In every case in which under the provisions of sections 393(1) [Table: Sl. Nos. 1(i) and 5], 393(2) [Table: Sl. Nos. 7, 8, 9 and 17] and 393(3) [Table: Sl. Nos. 1, 2 and 3] of the Income Tax Act, 2025 (hereafter in this Part referred to as the said Act), tax is to be deducted at the rates in force; deduction shall be made from the income subject to the deduction at the following rates: –
| Rate of income-tax | |||
| 1. | In the case of a person other than a company— | ||
| (a) where the person is resident in India, — | |||
| (i) on income by way of interest other than “Interest on securities” |
10%; |
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|
(ii) on income by way of winnings from lotteries, puzzles, card games and other games of any sort (other than winnings from online games) |
30%; |
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| (iii) on income by way of winnings from horse races |
30%; |
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| (iv) on income by way of net winnings from online games |
30%; |
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| (v) on income by way of insurance commission |
2%; |
||
| (vi) on income by way of interest payable on—
(A) any debentures or securities for money issued by or on behalf of any local authority or a corporation established by a Central, State or Provincial Act; (B) any debentures issued by a company where such debentures are listed on a recognized stock exchange in India in accordance with the Securities Contracts (Regulation) Act, 1956 (42 of 1956) and the rules made thereunder; (C) any security of the Central Government or State Government; |
10%; |
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| (vii) on any other income |
10%; |
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| (b) where the person is not resident in India, – | |||
| (i) In the case of non-resident Indian, – | |||
| (A) on any investment income |
20%; |
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|
(B) on income by way of long-term capital gains referred to in section 214 or 197(4) of the said Act |
12.5%; |
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|
(C) on income by way of long-term capital gains referred to in section 198 of the said Act exceeding ₹ 125000 |
12.5%; |
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|
(D) on other income by way of long-term capital gains [not being long-term capital gains referred to in Schedule II[Table: Sl. Nos. 14 and 17] [to the extent it relates to section 10(36) of the Income-tax Act, 1961 (43 of 1961)] of the said Act] |
12.5%; |
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|
(E) on income by way of short-term capital gains referred to in section 196 of the said Act |
20%; |
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|
(F) on income by way of interest payable by Government or an Indian concern on moneys borrowed or debt incurred by Government or the Indian concern in foreign currency (not being income by way of interest referred to in section 393(2) [Table: Sl. Nos. 2 to 5] of the said Act) |
20%; |
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|
(G) on income by way of royalty payable by Government or an Indian concern in pursuance of an agreement made by it with the Government or the Indian concern where such royalty is in consideration for the transfer of all or any rights (including the granting of a license) in respect of copyright in any book referred to in section 207(3)(a) of the said Act, to the Indian concern, or in respect of any computer software referred to in section 207(3)(b) of the said Act, to a person resident in India |
20%; |
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|
(H) on income by way of royalty [not being royalty of the nature referred to in sub-item (b)(i)(G)] payable by Government or an Indian concern in pursuance of an agreement made by it with the Government or the Indian concern and where such agreement is with an Indian concern, the agreement is approved by the Central Government or where it relates to a matter included in the industrial policy of the Government of India, the agreement is in accordance with that policy |
20%; |
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|
(I) on income by way of fees for technical services payable by Government or an Indian concern in pursuance of an agreement made by it with the Government or the Indian concern and where such agreement is with an Indian concern, the agreement is approved by the Central Government or where it relates to a matter included in the industrial policy of the Government of India, the agreement is in accordance with that policy |
20%; |
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|
(J) on income by way of winnings from lotteries, crossword puzzles, card games and other games of any sort (other than winnings from online games) |
30%; |
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|
(K) on income by way of winnings from horse races |
30%; |
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|
(L) on income by way of net winnings from online games |
30%; |
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(M) on income by way of dividend, referred to in section 207(1)[Table: Sl. No. 2] of the said Act |
10%; |
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(N) on income by way of dividend other than the income referred to in sub-item (b)(i)(M) |
20%; |
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|
(O) on the whole of the other income |
30%; |
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| (ii) in the case of any other person, — | |||
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(A) on income by way of interest payable by Government or an Indian concern on moneys borrowed or debt incurred by Government or the Indian concern in foreign currency (not being income by way of interest referred to in section 393(2) [Table: Sl. Nos. 2 to 5] of the said Act) |
20%; |
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|
(B) on income by way of royalty payable by Government or an Indian concern in pursuance of an agreement made by it with the Government or the Indian concern where such royalty is in consideration for the transfer of all or any rights (including the granting of a license) in respect of copyright in any book referred to in section 207(3)(a) of the said Act, to the Indian concern, in respect of any computer software referred to in section 207(3)(b) of the said Act, to a person resident in India |
20%; |
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|
(C) on income by way of royalty [not being royalty of the nature referred to in sub-item (b)(ii)(B)] payable by Government or an Indian concern in pursuance of an agreement made by it with the Government or the Indian concern and where such agreement is with an Indian concern, the agreement is approved by the Central Government or where it relates to a matter included in the industrial policy of the Government of India, the agreement is in accordance with that policy |
20%; |
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|
(D) on income by way of fees for technical services payable by Government or an Indian concern in pursuance of an agreement made by it with the Government or the Indian concern and where such agreement is with an Indian concern, the agreement is approved by the Central Government or where it relates to a matter included in the industrial policy of the Government of India, the agreement is in accordance with that policy |
20%; |
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|
(E) on income by way of winnings from lotteries, crossword puzzles, card games and other games of any sort (other than winnings from online games) |
30%; |
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|
(F) on income by way of winnings from horse races |
30%; |
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|
(G) on income by way of net winnings from online games |
30%; |
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|
(H) on income by way of short- term capital gains referred to in section 196 of the said Act |
20%; |
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|
(I) on income by way of long-term capital gains referred to in section 197(4) of the said Act |
12.5%; |
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|
(J) on income by way of long-term capital gains referred to in section 198 of the said Act exceeding ₹ 125000 |
12.5%; |
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|
(K) on other income by way of long-term capital gains [not being long-term capital gains referred to in Schedule II [Table: Sl. Nos. 14 and 17 [to the extent it relates to section 10(36) of the Income-tax Act, 1961 (43 of 1961)] of the said Act |
12.5%; |
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|
(L) on income by way of dividend, referred to in section 207(1) [Table: Sl. No. 2] of the said Act |
10%; |
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|
(M) on income by way of dividend other than the income referred to in sub-item (b)(ii)(L) |
20%; |
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| (N) on the whole of the other income |
30%; |
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Surcharge on income-tax
The amount of income-tax deducted as per the provisions of this Part, in the case of a person as specified in column B of the Table below, shall be increased by a surcharge, for the purposes of the Union, calculated at the rate or rates as specified in column C of the said Table, of such tax.
| TABLE | ||
| Sl.
No. |
Person in respect of which deduction has to be made |
Rate of surcharge |
|
A |
B |
C |
| 1. | (i) Every individual; or
(ii) Hindu undivided family; or (iii) association of persons, except in a case of an association of persons consisting of only companies as its members, whether incorporated or not; or (iv) body of individuals, whether incorporated or not; or (v) every artificial juridical person referred to in section 2(77)(g) of the said Act,
being a non-resident, except in case where the income of such person, is chargeable to tax under section 202 of the said Act. |
(i) Where the income or the aggregate of such incomes (including dividend income or capital gains under the provisions of sections 196, 197 and 198 of the said Act) paid or likely to be paid and subject to the deduction exceeds ₹50Lacs but does not exceed ₹1Cr, at the rate of 10%;
(ii) where the income or the aggregate of such incomes (including dividend income or capital gains under the provisions of sections 196, 197 and 198 of the said Act) paid or likely to be paid and subject to the deduction exceeds ₹1Cr but does not exceed ₹2Cr, at the rate of 15%; (iii) where the income or the aggregate of such incomes (excluding dividend income or capital gains under the provisions of sections 196, 197 and 198 of the said Act) paid or likely to be paid and subject to the deduction exceeds ₹2Cr but does not exceed ₹5Cr, at the rate of 25%; (iv) where the income or the aggregate of such incomes (excluding the income by way of dividend or income under the provisions of sections 196, 197 and 198 of the said Act) paid or likely to be paid and subject to the deduction exceeds ₹5Cr, at the rate of 37%; (v) where the income or the aggregate of such incomes (including dividend income or capital gains under the provisions of sections 196, 197 and 198 of the said Act) paid or likely to be paid and subject to the deduction exceeds ₹2Cr, but is not covered under clauses (iii) and (iv), at the rate of 15%; (vi) where the total income includes dividend income or capital gains under sections 196, 197 and 198 of the said Act, the rate of surcharge on the amount of income-tax computed in respect of that part of income shall not exceed 15% and the clause (i) or (ii), as the case may be, shall apply accordingly. |
| 2. |
(i) Every individual, or (ii) Hindu undivided family; or (iii) association of persons, except in a case of an association of persons consisting of only companies as its members, whether incorporated or not; or (iv) body of individuals, whether incorporated or not; or (v) every artificial juridical person referred to in section 2(77)(g) of the said Act,
being a non-resident where the income of such person is chargeable to tax under section 202 of the said Act. |
(i) Where the income or the aggregate of such incomes (including dividend income or capital gains under the provisions of sections 196, 197 and 198 of the said Act) paid or likely to be paid and subject to the deduction exceeds ₹50Lacs but does not exceed ₹1Cr, at the rate of 10%; (ii) where the income or the aggregate of such incomes (including dividend income or capital gains under the provisions of sections 196, 197 and 198 of the said Act) paid or likely to be paid and subject to the deduction exceeds ₹1Cr but does not exceed ₹2Cr, at the rate of 15%; (iii) where the income or the aggregate of such incomes (excluding dividend income or capital gains under the provisions of sections 196, 197 and 198 of the said Act) paid or likely to be paid and subject to the deduction exceeds ₹2Cr, at the rate of 25%; (iv) where the income or the aggregate of such incomes (including dividend income or capital gains under the provisions of sections 196, 197 and 198 of the said Act) paid or likely to be paid and subject to the deduction exceeds ₹2Cr but is not covered under clauses (iii), at the rate of 15%; (v) where the total income includes dividend income or capital gains under sections 196, 197 and 198 of the said Act, the rate of surcharge on the amount of income-tax deducted in respect of that part of income shall not exceed 15% and the clause (i) or (ii), as the case may be, shall apply accordingly. |
| 3. |
Association of persons, being a non-resident, and consisting of only companies as its members. |
(i) Where the income or the aggregate of such incomes paid or likely to be paid and subject to the deduction exceeds ₹50Lacs but does not exceed ₹1Cr, at the rate of 10%; (ii) where the income or the aggregate of such incomes paid or likely to be paid and subject to the deduction exceeds ₹1Cr, at the rate of 15%. |
| 4. |
Every co-operative society, being a non-resident. |
(i) Where the income or the aggregate of such incomes paid or likely to be paid and subject to the deduction exceeds ₹1Cr but does not exceed ₹10Cr, at the rate of 7%; (ii) where the income or the aggregate of such incomes paid or likely to be paid and subject to the deduction exceeds ₹10Cr, at the rate of 12%. |
| 5. |
Every firm, being a non- resident. |
Where the income or the aggregate of such incomes paid or likely to be paid and subject to the deduction exceeds ₹1Cr, at the rate of 12%. |
