TDS Rate Chart 2025-26: Complete Section-Wise Guide (Budget 2025 Updated)
Every section, every threshold, and every Budget 2025 change — in one place
The TDS rate chart for FY 2025-26 covers 30+ sections under the Income Tax Act. Key rates: Salary — as per applicable tax slab, Bank FD interest — 10% above ₹50,000, Dividends, 10% above ₹5,000, Professional fees — 10% above ₹30,000, Rent — 10% above ₹6,00,000/year. Budget 2025 raised several threshold limits, most notably doubling the rent TDS threshold from ₹2.4 lakh to ₹6 lakh annually, and cut insurance maturity (194DA) and individual rent (194-IB) TDS rates from 5% to 2%.
Anyone who has looked up a TDS rate mid-audit knows the problem: most online sources are three years out of date, cover five sections when there are thirty, or bury the actual rates inside 4,000 words of context nobody asked for.
This is the complete TDS rate chart for FY 2025-26 (Assessment Year 2026-27), every section, every threshold, and everything Budget 2025 changed. A dedicated section covers stock market income, the area where retail traders and investors most consistently get TDS wrong.
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What Budget 2025 changed in TDS (effective April 1, 2025)
Before the full chart, here is what actually changed from FY 2025-26 onwards.
| Section | Nature of payment | Old threshold / rate | New (FY 2025-26) |
|---|---|---|---|
| 194A | Bank / Co-op / Post Office interest (non-senior) | ₹40,000 threshold | ₹50,000 threshold |
| 194A | Bank / Co-op / Post Office interest (senior citizens) | ₹50,000 threshold | ₹1,00,000 threshold |
| 194A | Interest from other sources (company deposits etc.) | ₹5,000 threshold | ₹10,000 threshold |
| 194-I | Rent (entities subject to tax audit) | ₹2,40,000 per year | ₹6,00,000 per year |
| 194-IB | Rent paid by individual / HUF (monthly ≥ ₹50,000) | 5% rate | 2% rate |
| 194DA | Life insurance policy maturity proceeds | 5% rate | 2% rate |
| 194T | Salary / interest / commission to partners from firm | Not applicable (new section) | 10% above ₹20,000 |
The 194-I rent change in practice: The threshold jump from ₹2.4 lakh to ₹6 lakh means monthly rent up to ₹50,000 is now below the TDS threshold. If your business pays ₹40,000/month for office space (₹4.8 lakh/year), TDS under 194-I no longer applies from FY 2025-26. Genuine relief for small businesses that have been wrestling with Form 26Q compliance every quarter.
Complete TDS rate chart 2025-26, all sections
Rates below apply when the payee furnishes a valid PAN. Without PAN, TDS is deducted at 20% or the applicable rate, whichever is higher (Section 206AA). For resident payees, the base rate is the final deduction. For non-residents, add a surcharge and 4% health and education cess on top.
| Section | Nature of payment | Threshold limit | TDS rate | FY 2025-26 note |
|---|---|---|---|---|
| 192 | Salary income | As per tax slab (see below) | As per applicable slab | New regime is default; Budget 2025 revised new regime slabs |
| 192A | Premature PF withdrawal | ₹50,000 | 10% | — |
| 193 | Interest on securities (debentures, bonds) | ₹10,000 | 10% | — |
| 194 | Dividend from domestic company | ₹5,000 | 10% | — |
| 194A | Interest other than securities — banks / co-op / post office | ₹50,000 (₹1,00,000 for senior citizens) ★ Budget 2025 | 10% | Threshold raised; senior citizen limit doubled |
| 194A | Interest other than securities — others (company deposits, etc.) | ₹10,000 ★ Budget 2025 | 10% | Raised from ₹5,000 |
| 194B | Lottery / crossword / game show winnings | ₹10,000 per transaction | 30% | Now per-transaction basis (not aggregate) |
| 194BB | Horse race winnings | ₹10,000 per transaction | 30% | Now per-transaction basis |
| 194C | Payment to contractor — Individual / HUF | Single: ₹30,000 | Annual: ₹1,00,000 | 1% | — |
| 194C | Payment to contractor — Others (company, firm, etc.) | Single: ₹30,000 | Annual: ₹1,00,000 | 2% | — |
| 194D | Insurance commission | ₹15,000 | 5% (domestic), 20% (foreign) | — |
| 194DA | Life insurance maturity proceeds (taxable portion) | ₹1,00,000 | 2% ★ Budget 2025 | Reduced from 5% |
| 194E | Payment to NR sportsman / entertainer / sports association | Nil | 20% | — |
| 194EE | NSS withdrawal | ₹2,500 | 10% | — |
| 194G | Commission on sale of lottery tickets | ₹15,000 | 5% | — |
| 194H | Commission or brokerage (not securities) | ₹15,000 | 5% | — |
| 194-I(a) | Rent — plant, machinery, equipment | ₹6,00,000 per year ★ Budget 2025 | 2% | Threshold raised from ₹2,40,000 |
| 194-I(b) | Rent — land, building, furniture, fittings | ₹6,00,000 per year ★ Budget 2025 | 10% | Threshold raised from ₹2,40,000 |
| 194-IA | Transfer of immovable property (buyer deducts) | ₹50,00,000 | 1% | — |
| 194-IB | Rent by individual / HUF (not covered under 194-I) | ₹50,000 per month | 2% ★ Budget 2025 | Reduced from 5% |
| 194-IC | Monetary consideration in Joint Development Agreement | Nil | 10% | — |
| 194J(a) | Technical services / royalty for software sale / call centre | ₹30,000 | 2% | — |
| 194J(b) | Professional fees / director fees / royalty | ₹30,000 (Nil for director fees) | 10% | — |
| 194K | Dividend / income from mutual fund units | ₹5,000 | 10% | — |
| 194LA | Compensation on compulsory acquisition of property | ₹2,50,000 | 10% | — |
| 194LB | Interest from infrastructure bonds (NRI) | Nil | 5% | — |
| 194LC | Interest on External Commercial Borrowings by Indian company | Nil | 5% | — |
| 194LD | Interest on government securities / bonds to FIIs / QFIs | Nil | 5% | — |
| 194M | Payment to contractor / professional by individual/HUF not subject to tax audit | ₹50,00,000 aggregate | 2% | — |
| 194N | Cash withdrawal from bank — ITR filer | ₹1 crore | 2% on amount above ₹1 crore | — |
| 194N | Cash withdrawal — ITR non-filer (last 3 years) | ₹20 lakh | 2% (₹20L–₹1Cr); 5% (above ₹1Cr) | — |
| 194O | E-commerce operator payment to participants | ₹5,00,000 aggregate | 1% | — |
| 194Q | Purchase of goods by buyer (turnover > ₹10 crore) | ₹50 lakh aggregate | 0.1% | — |
| 194R | Benefit or perquisite from business / profession | ₹20,000 aggregate | 10% | — |
| 194S | VDA (crypto) — specified person (turnover ≤ ₹1 crore / receipts ≤ ₹50L) | ₹50,000 per transaction | 1% | — |
| 194S | VDA (crypto) — others | ₹10,000 per transaction | 1% | — |
| 194T | Salary / interest / commission / bonus / remuneration to partners | ₹20,000 per annum ★ New | 10% | New section effective April 1, 2025 |
| 195 | Any payment to non-resident / foreign company | Nil | As per DTAA or domestic rate — varies | Must check DTAA; see NRI section below |
| 196B | Income from offshore fund | Nil | 10% | — |
| 196C | Income from foreign currency bonds or GDRs | Nil | 10% | — |
| 196D | Income of Foreign Institutional Investors (FIIs) from securities | Nil | 20% | — |
★ Budget 2025 = change effective from April 1, 2025 (FY 2025-26)
Section 192 — TDS on salary (FY 2025-26)
Section 192 is not a flat rate. Your employer calculates TDS based on your estimated annual income under whichever regime you have opted into — new or old.
New tax regime slabs (default from FY 2023-24, revised in Budget 2025)
| Annual income | Tax rate |
|---|---|
| Up to ₹4,00,000 | Nil |
| ₹4,00,001 – ₹8,00,000 | 5% |
| ₹8,00,001 – ₹12,00,000 | 10% |
| ₹12,00,001 – ₹16,00,000 | 15% |
| ₹16,00,001 – ₹20,00,000 | 20% |
| ₹20,00,001 – ₹24,00,000 | 25% |
| Above ₹24,00,000 | 30% |
Budget 2025's headline move was expanding the Section 87A rebate to cover income up to ₹12 lakh — meaning zero income tax under the new regime up to that level. For salaried employees, add the ₹75,000 standard deduction and the effective threshold becomes ₹12,75,000 gross salary. If your CTC is at or below that number, your employer should not deduct any TDS at all.
Old tax regime slabs (if opted in)
| Annual income | Tax rate |
|---|---|
| Up to ₹2,50,000 | Nil |
| ₹2,50,001 – ₹5,00,000 | 5% |
| ₹5,00,001 – ₹10,00,000 | 20% |
| Above ₹10,00,000 | 30% |
The old regime lets you claim 80C (₹1.5 lakh), 80D, HRA, and LTA — which can cut your taxable income and the TDS that comes with it. It still makes sense if you have a home loan, HRA, or heavy 80C investments. If you don't, the new regime's lower slab rates and the ₹12 lakh rebate will almost certainly win.
Submit your investment declaration to your employer in April, when HR systems open for it. If you switch regimes mid-year or add investments late, your employer adjusts TDS in the final months — which sometimes means large single-month deductions. Do it early to keep things smooth across the year.
TDS on stock market income
Traders and investors face a specific set of TDS provisions that generic tax guides almost never cover properly. Here is what actually applies.
Dividends (Section 194 and 194K)
Since DDT was abolished in FY 2020-21, dividends are taxable in your hands. Companies deduct TDS at 10% if your dividend from a single company exceeds ₹5,000 in the financial year. Mutual fund dividends under the IDCW option fall under 194K — same 10% rate, same ₹5,000 threshold per fund house.
If your total income is below the basic exemption limit, submit Form 15G (or 15H for senior citizens) to the company or fund house before the dividend is paid. That stops TDS at source.
Capital gains — no TDS for residents (with one exception)
For resident Indians, there is no TDS on capital gains from equity, mutual funds, or bonds. You report these in your ITR and pay advance tax or self-assessment tax. The one carve-out is Section 194-IA for property sales above ₹50 lakh, where the buyer must deduct 1% TDS on the transaction.
For NRI investors, capital gains from Indian equity are subject to TDS under Section 195 — covered below.
Interest on bonds and debentures (Section 193)
If you hold listed debentures or bonds, TDS at 10% applies on interest above ₹10,000. Government Securities, RBI Bonds, and tax-free bonds are generally exempt from Section 193 TDS, but always verify the specific exemption notification for each instrument before assuming.
Section 194N — cash withdrawals from trading accounts
Large cash withdrawals from a brokerage-linked bank account fall under 194N. The ₹1 crore threshold applies per bank, per FY — it does not aggregate across banks. Traders with multiple brokers and bank accounts often miss this.
Section 194S- crypto and VDA transactions
Every transaction in Bitcoin, Ethereum, or any other Virtual Digital Asset on an Indian exchange triggers 1% TDS above ₹10,000 per transaction (₹50,000 for specified persons with lower turnover). The exchange deducts this and it appears in your Form 26AS and AIS. You can credit it against your final tax liability. Unlike equity losses, VDA losses cannot be set off against other income — and the TDS obligation is on the exchange, not you, so it happens whether you know about it or not.
TDS for NRI investors: Section 195 and related provisions
NRI taxation is where compliance gaps are most common in practice — usually because the Indian payer applies domestic rates without first checking whether a DTAA applies or whether the NRI holds a lower deduction certificate.
| Type of income | Section | TDS rate (no DTAA) | Note |
|---|---|---|---|
| Short-term capital gains on equity (STT paid) | 195 r/w 111A | 15% + surcharge + cess | DTAA may reduce; verify before deducting |
| Long-term capital gains on equity (STT paid) | 195 r/w 112A | 10% (above ₹1.25 lakh exemption) | Post Budget 2024 rate; indexation not available |
| Dividend income | 195 | 20% + surcharge + cess | DTAA rate typically 10–15% |
| Interest on NRO account | 195 | 30% + surcharge + cess | Most DTAA treaties reduce this substantially |
| Rent from Indian property | 195 | 30% + surcharge + cess | NRI can apply for lower deduction certificate u/s 197 |
| Professional / business income (non-PE) | 195 | As applicable | DTAA Article on royalties / FTS governs this |
NRIs with genuine lower tax liability can apply to the Assessing Officer under Section 197 for a lower deduction certificate. This matters most for NRIs earning rental income in India — the gross rent attracts 30% TDS, but net income after repair deductions and depreciation is often a fraction of that. The Section 197 route stops the overcollection.
Section 206AB: higher TDS for non-filers
Most people ignore this section until they get a notice. Section 206AB requires the deductor to apply the higher of twice the applicable rate or 5% on payments to anyone who has not filed their ITR for the two preceding financial years, where TDS/TCS in each of those years exceeded ₹50,000.
In practice, if you are a vendor, consultant, or professional who missed returns for FY 2022-23 and FY 2023-24, companies paying you in FY 2025-26 are legally required to verify your filing status on the income tax compliance portal and deduct at the higher rate. The portal supports bulk verification, so large payers do check. Build a verification step into your accounts payable process for vendors above ₹1 lakh per transaction.
How to verify TDS deducted against your PAN
Use both these sources, not just one — deductors often update them at different speeds:
- Form 26AS, available on incometax.gov.in under My Account, shows TDS by each deductor quarter-wise. This is the primary credit record.
- AIS (Annual Information Statement), under Services on the same portal, is the newer version. It covers TDS plus all financial transactions — mutual fund purchases, equity trades, bank deposits, and foreign remittances.
Reconcile Form 26AS against your actual income before filing your ITR. If a deductor has deposited TDS under the wrong PAN or financial year, only they can correct it by filing a revised TDS statement. The Assessing Officer cannot fix it unilaterally.
What happens if you don't deduct TDS
Four consequences, in increasing order of pain:
The first is disallowance under Section 40(a)(ia), 30% of the payment is disallowed in your income computation. You have already paid the vendor the full amount; now you also lose 30% of that as a deduction. On large contractor payments, this hits hard in scrutiny assessments.
The second is interest under Section 201(1A): 1.5% per month from the date TDS was deductible to the date of actual deduction, then 1% per month from deduction date to deposit date. These compound quietly and become a real number by the time an assessment notice arrives.
The third is a penalty under Section 271C — up to 100% of the TDS amount that should have been deducted.
The fourth, rarely used but on the books, is prosecution under Section 276B for persistent non-remittance of TDS after it has actually been deducted: rigorous imprisonment from three months to seven years.
The 40(a)(ia) disallowance is the one that stings in scrutiny assessments. Businesses have faced situations where a full year's contractor payments — running into crores — were partially disallowed because TDS was applied at 1% as a contractor payment instead of 10% as professional fees. The deductor's reasoning does not matter; the correct section and correct rate are what the law requires.
TDS certificates — Forms 16, 16A, 16B, and 16C
Every deductor must issue a TDS certificate to the payee:
| Form | For | Deadline |
|---|---|---|
| Form 16 | TDS on salary (Part A — deposit; Part B — income computation) | June 15 after end of FY |
| Form 16A | TDS on non-salary payments (FD interest, professional fees, rent, etc.) | 15 days from TDS return due date per quarter |
| Form 16B | TDS on property purchase (Section 194-IA) | 15 days from return filing via Form 26QB |
| Form 16C | TDS on rent by individual/HUF (Section 194-IB) | 15 days from return filing via Form 26QC |
Five TDS mistakes that come up repeatedly
The same errors surface across industries, company sizes, and financial years.
The most common is applying 194C instead of 194J for professional services. IT companies routinely classify software development fees as "contract work" at 2% when they should be "technical services" under 194J(a), also 2%, but a different section, or "professional fees" under 194J(b) at 10%. The correct classification depends on whether the service provider exercises independent professional judgment, not on whether there is a contract document. A software development agreement from a registered company is typically 194J(a) at 2%. The same work from a freelancer using their own professional expertise may be 194J(b) at 10%.
Second is missing 194-IB entirely. If you rent a flat or office for more than ₹50,000 per month and you are an individual or HUF, you are required to deduct 2% TDS once a year and deposit it via Form 26QC. Most tenants paying ₹60,000–₹80,000 per month in metro cities have never heard of this provision. The liability is on the tenant, not the landlord.
Third is the under-construction property mistake under 194-IA. The ₹50 lakh threshold applies to the total consideration, not each installment. If you buy a flat for ₹70 lakh and pay in eight installments, TDS at 1% is due on every installment from the first one, not just after the aggregate crosses ₹50 lakh.
Fourth: not running Section 206AB checks before large payments. The deductor's liability does not go away because the vendor failed to disclose that they hadn't filed returns. Use the income tax portal's compliance check before any significant payment to a new or irregular vendor.
Fifth is ignoring crypto TDS under 194S. Many retail traders assume crypto transactions are informal and off the radar. Indian exchanges are legally required to deduct 1% TDS on every qualifying transaction. Not seeing a deduction does not mean it didn't happen — check your AIS before filing your ITR.
Disclaimer: This guide is for general information. Tax law changes with each Budget and is subject to notifications, circulars, and judicial interpretations. For non-resident taxation, property transactions, and Section 206AB compliance situations, consult a qualified CA.