TDS & TCS Rate Chart
Tax Year 2026-27

Income Tax Act, 2025 · Effective 1st April 2026
⚠️ Rates exclude Surcharge & H&E Cess @4%
8
Sections with Rate / Threshold Changes
1
Newly Introduced Section (Sec 194T)
25+
Sections Unchanged — New Section Numbers Apply
Apr 1
Effective Date — All changes from 1st April 2026
Important: From 1st April 2026, all TDS provisions are consolidated under Section 392 (Salary & EPF) and Section 393 (all other payments) of the new Income Tax Act, 2025. The old section numbers (192–194T) are retained below for reference only.

▼ Rate Reductions

Nature of Payment Old Section New Section Threshold Limit Old Rate New Rate Remarks
Commission / Brokerage ↓ Reduced Sec 194HSec 393 ₹15,000 p.a. 5% 2% Agents, distributors, brokers, etc.
Lottery / Crossword Commission ↓ Reduced Sec 194GSec 393 ₹20,000 p.a. (was ₹15,000) 5% 2% Rate reduced; threshold also enhanced.
Rent — Individual / HUF (not in tax audit) ↓ Reduced Sec 194IBSec 393 ₹50,000 per month 5% 2% Significant relief for tenants.
Payments by Indiv./HUF to Contractors/Professionals ↓ Reduced Sec 194MSec 393 ₹50,00,000 p.a. 5% 2% For contractor & professional payments by individuals/HUFs.
E-Commerce Participant Sales ↓ Reduced Sec 194OSec 393 Nil 1% 0.1% Major relief for sellers on Amazon, Flipkart, Meesho, etc.
Supply of Manpower Services ↓ Reclassified Sec 194JSec 393 (as 'Work') ₹30,000/txn or ₹1 lakh p.a. 10% 1% / 2% Budget 2026: Reclassified as contractor 'Work'. Rate drops sharply.
MACT Interest — Individuals / Legal Heirs ↓ Exempt Sec 194ASec 393 Any amount 10% NIL Budget 2026: Fully exempt for individuals & legal heirs.

★ New Provision

Nature of Payment Old Section New Section Threshold Limit Old Rate New Rate Remarks
Payments to Partners of Firms / LLPs ★ New Sec 194T (NEW)Sec 393 ₹20,000 p.a. NIL 10% TDS @10% on salary, bonus, commission & interest paid to partners.

⬆ Threshold Limit Enhancements (Rate Unchanged)

Nature of Payment Old Section New Section Old Threshold New Threshold TDS Rate Remarks
Bank Interest — Senior Citizens ↑ Enhanced Sec 194ASec 393 ₹50,000 p.a. ₹1,00,000 p.a. 10% Threshold doubled. Major relief on FD interest.
Bank Interest — Others ↑ Enhanced Sec 194ASec 393 ₹40,000 p.a. ₹50,000 p.a. 10% Threshold enhanced.
Rent — Plant, Machinery & Equipment ↑ Enhanced Sec 194I(a)Sec 393 ₹2,40,000 p.a. ₹6,00,000 p.a. 2% Assessed on monthly basis now.
Rent — Land / Building / Furniture ↑ Enhanced Sec 194I(b)Sec 393 ₹2,40,000 p.a. ₹6,00,000 p.a. 10% Assessed on monthly basis now.
Compulsory Acquisition Compensation ↑ Enhanced Sec 194LASec 393 ₹2,50,000 ₹5,00,000 10% Threshold doubled.
Insurance / Brokerage Commission ↑ Enhanced Sec 194D / 194GSec 393 ₹15,000 p.a. ₹20,000 p.a. 5% Threshold raised.
Note on Section Numbering: All old sections 192–194T of the IT Act, 1961 are now replaced by Section 392 and Section 393 of the IT Act, 2025. Rates and thresholds are unchanged below, but you must update your ERP/accounting software to reference new section numbers and use new 4-digit TRACES payment codes.

Salary & EPF

Nature of PaymentOld SectionNew SectionThresholdTDS RateRemarks
Salary / WagesSec 192Sec 392Basic exemption limitAs per slabTax on estimated annual salary.
EPF Withdrawal (with PAN)Sec 192ASec 392₹50,00010%No change.
EPF Withdrawal (without PAN)Sec 192ASec 392₹50,00020%Higher rate for non-PAN cases.

Interest Income

Nature of PaymentOld SectionNew SectionThresholdTDS RateRemarks
Interest on SecuritiesSec 193Sec 393₹10,000 p.a.10%No change.

Dividend

Nature of PaymentOld SectionNew SectionThresholdTDS RateRemarks
Dividend — Domestic CompaniesSec 194Sec 393₹5,000 p.a.10%No change.
Dividend — Mutual FundsSec 194KSec 393₹5,000 p.a.10%No change.

Winnings & Games

Nature of PaymentOld SectionNew SectionThresholdTDS RateRemarks
Winnings — Lottery / Crossword / PuzzleSec 194BSec 393₹10,000 per txn30%No change.
Winnings — Horse RaceSec 194BBSec 393₹10,000 per txn30%No change.
Winnings — Online Games (Net)Sec 194BASec 393Net winnings30%No change.

Contractors & Professional Fees

Nature of PaymentOld SectionNew SectionThresholdRate — Indiv/HUFRate — OthersRemarks
Payment to ContractorsSec 194CSec 393₹30,000/txn or ₹1 lakh p.a.1%2%No change.
Professional Fees (CA, Doctor, Lawyer, Architect)Sec 194JSec 393₹30,000 p.a.10%10%No change.
Technical Services / Call CentresSec 194JSec 393₹30,000 p.a.2%2%No change.

Immovable Property

Nature of PaymentOld SectionNew SectionThresholdTDS RateRemarks
Sale of Immovable Property (Buyer deducts)Sec 194IASec 393₹50,00,000 per txn1%No change.

Insurance

Nature of PaymentOld SectionNew SectionThresholdTDS RateRemarks
Insurance CommissionSec 194DSec 393₹20,000 p.a. (was ₹15,000)5%Rate unchanged; threshold enhanced.
Insurance Maturity Proceeds (Taxable)Sec 194DASec 393₹1,00,000 p.a.5%No change.

Goods, Digital Assets & Others

Nature of PaymentOld SectionNew SectionThresholdTDS RateRemarks
Purchase of Goods (Buyer deducts)Sec 194QSec 393₹50,00,000 p.a. per seller0.1%No change.
Transfer of Virtual Digital Assets (Crypto)Sec 194SSec 393₹50,000 (specified) / ₹10,000 (others)1%No change.
Non-Furnishing of PAN (Higher TDS)Sec 206AASec 206AA—20% or applicable rate (higher)Always ensure PAN is collected.

Provisions Removed for FY 2026-27

ProvisionOld SectionStatusRemarks
Higher TDS for Non-ITR Filers RemovedSec 206ABDiscontinuedProvision for higher TDS on non-ITR filers removed w.e.f. FY 2026-27. Reduces compliance burden on deductors.
TCS on Sale of Goods by Seller RemovedSec 206C(1H)DiscontinuedRemoved to avoid double deduction overlap with Sec 194Q (TDS by buyer on purchase of goods).
TCS (Tax Collected at Source) is collected by the seller / collector at the time of receipt. From 1st April 2026, TCS provisions are governed by Section 394 of the Income Tax Act, 2025 (replacing Section 206C of the 1961 Act).

TCS Rate Changes — FY 2026-27

Nature of CollectionOld SectionNew SectionThresholdOld RateNew RateRemarks
Overseas Tour Program Package ↓ Reduced Sec 206C(1G)Sec 394 Any amount 5% / 20% 2% Budget 2026: Flat 2% without any stipulation on amount. Simplified.
LRS — Education (overseas remittance) ↓ Reduced Sec 206C(1G)Sec 394 Above ₹7 lakh p.a. 5% 2% Budget 2026: TCS on education remittances under LRS reduced to 2%.
LRS — Medical Treatment (overseas remittance) ↓ Reduced Sec 206C(1G)Sec 394 Above ₹7 lakh p.a. 5% 2% Budget 2026: TCS on medical remittances under LRS reduced to 2%.
Sale of Scrap ↑ Increased Sec 206C(1)Sec 394 Any amount 1% 2% Budget 2026: TCS rate on scrap doubled to 2%.
Sale of Alcoholic Liquor for Human Consumption ↑ Increased Sec 206C(1)Sec 394 Any amount 1% 2% Budget 2026: Rate revised to 2%.

TCS Rates — Unchanged

Nature of CollectionOld SectionNew SectionThresholdTCS RateRemarks
Sale of Timber (forest lease)Sec 206C(1)Sec 394Any amount2.5%No change.
Sale of Tendu LeavesSec 206C(1)Sec 394Any amount5%No change.
Sale of Minerals (coal, lignite, iron ore)Sec 206C(1)Sec 394Any amount1%No change.
Sale of Motor Vehicle (value > ₹10 lakh)Sec 206C(1F)Sec 394₹10,00,000 per vehicle1%No change.
LRS — Remittances (other than education/medical)Sec 206C(1G)Sec 394Above ₹7 lakh p.a.20%No change.
Foreign Remittance under LRS (education via loan)Sec 206C(1G)Sec 394Above ₹7 lakh p.a.0.5%No change. Education financed by loan from financial institution.
Action Required Immediately: All deductors must update their ERP, payroll, and accounting systems to reflect new section numbers and TRACES payment codes before processing any payment in Tax Year 2026-27.

New TDS / TCS Return Forms

Old FormNew FormPurposeEffective
Form 24QForm 138Quarterly TDS Return — Salary1st April 2026
Form 26QForm 140Quarterly TDS Return — Non-Salary (Domestic)1st April 2026
26QB / 26QC / 26QD / 26QEForm 141Unified Challan-cum-Statement (Property / Rent / VDA / Indiv-HUF)1st April 2026
Form 15G / 15HForm 121Self-Declaration for Nil / Lower Deduction1st April 2026

Key Compliance Checklist

#Action ItemPriority
1Update ERP / payroll software to use new Section 393 references (not old 194C, 194J, etc.) in all TDS returns from Q1 FY 2026-27.High
2Apply reduced TDS rates — especially for commission (5%→2%), rent by Indiv/HUF (5%→2%), manpower supply (10%→1%/2%), and e-commerce (1%→0.1%).High
3Firms & LLPs: Start deducting TDS @10% on payments to partners exceeding ₹20,000 p.a. (new Sec 194T / Sec 393).High
4Replace Forms 24Q / 26Q with new Forms 138 / 140. Replace 26QB/26QC/26QD/26QE with unified Form 141.High
5Replace Forms 15G / 15H with new Form 121 for nil/lower deduction self-declarations by payees.Medium
6Ensure PAN of all deductees is updated — non-furnishing still attracts TDS @20% (Sec 206AA continues).High
7Small taxpayers may now apply for lower/nil TDS certificates electronically to the prescribed authority (simplified process under Budget 2026).Medium
8Transition rule: Transactions credited/paid on or before 31st March 2026 → governed by IT Act 1961. On or after 1st April 2026 → IT Act 2025.Medium

TDS / TCS Deposit Due Dates

Deductor TypeMonth of DeductionDue Date for DepositRemarks
Non-Government DeductorsApril to February7th of following monthGeneral rule.
Non-Government DeductorsMarch30th AprilExtended due date for March deductions.
Form 141 cases (Property / Rent / VDA)Any month30 days from end of monthChallan-cum-statement cases.
Government DeductorsWithout challanSame dayTreasury deductors.
Government DeductorsWith challan7th of following month—
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This chart is based on the Income Tax Act, 2025, Finance Act 2024, and Budget 2026 proposals. All rates exclude applicable Surcharge and Health & Education Cess @4%. For specific advice, please contact our office.