The Government has introduced the Income-tax Act, 2025, which will replace the Income-tax Act, 1961 from 1 April 2026.
One of the most significant changes introduced by the new law is the restructuring of TDS and TCS provisions. Under the earlier Act, Tax Deducted at Source (TDS) provisions were spread across many sections such as 192, 194A, 194C, 194H, 194J, 194Q, etc.
The Income Tax Act 2025 consolidates and reorganizes these provisions, mainly under Section 392 and Section 393, making the withholding tax framework more structured and easier to understand.
This article provides a complete comparison chart of old TDS sections vs new TDS sections along with rates, deductors and threshold limits.
New Sections will be applicable from 1 April 2026
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TDS Rate Chart FY 2026-27 (Applicable from 1 April 2026 under Income Tax Act 2025)
| Particulars | Old Sec | New Sec | Deductor | Rate (%) | Threshold Limit | Exemptions / Notes |
|---|---|---|---|---|---|---|
| Salary | 192 | 392 | Employer | Slab Rates | Basic exemption limit | Based on estimated salary income |
| Accumulated Balance of PF | 192A | 392 | Any person | 10% | ₹50,000 | Applicable if PF withdrawn before completion of 5 years of service |
| Interest on Securities | 193 | 393 Table 1 S.No.(5)(i) | Any person | 10% | ₹10,000 | Exempt: Govt securities, LIC, GIC, insurers |
| Dividend | 194 | 393 Table 1 S.No.(7) | Company | 10% | ₹10,000 | Exempt: Dividend paid to business trust (REIT/InvIT) |
| Interest other than securities | 194A | 393 Table 1 S.No.(5)(ii) | Specified person | 10% | Senior citizen (by Bank or PO) ₹1,00,000; Individual Other than senior citizens (by Bank or PO)₹50,000; Others ₹10,000 | — |
| Lottery / Game winnings | 194B | 393 Table 3 S.No.(1) | Any person | 30% | ₹10,000 | On net winnings |
| Online gaming winnings | 194BA | 393 Table 3 S.No.(2) | Any person | 30% | No limit | On net winnings |
| Horse race winnings | 194BB | 393 Table 3 S.No.(3) | Any person | 30% | ₹10,000 | — |
| Payment to contractors | 194C | 393 Table 1 S.No.(6)(i) | Specified person | 1% / 2% | ₹30,000 single payment or ₹1,00,000 aggregate | 1% Individual/HUF, 2% Others |
| Insurance commission | 194D | 393 Table 1 S.No.(1)(i) | Insurance company | 2% | ₹20,000 | — |
| Life insurance policy payment | 194DA | 393 Table 1 S.No.(8)(i) | Insurance company | 2% | ₹1,00,000 | Rate applied on income component |
| Non-resident sportsmen | 194E | 393 | Any person | 20% | No threshold | — |
| Commission on lottery tickets | 194G | 393 Table 3 S.No.(4) | Any person | 2% | ₹20,000 | — |
| Commission / Brokerage | 194H | 393 Table 1 S.No.(1)(ii) | Specified person | 2% | ₹20,000 | Excludes BSNL/MTNL PCO franchise commission |
| Rent | 194I | 393 Table 1 S.No.(2)(ii) | Specified person | 2% / 10% | ₹50,000 per month | Plant & machinery 2%, Land/building 10% |
| Sale of property | 194IA | 393 Table 1 S.No.(3)(i) | Buyer | 1% | ₹50 lakh | Higher of consideration or stamp duty value |
| Rent by Individual/HUF | 194IB | 393 Table 1 S.No.(2)(i) | Individual/HUF | 2% | ₹50,000 per month | Applicable if not liable to tax audit |
| Professional / technical services | 194J | 393 Table 1 S.No.(6)(iii) | Specified person | 10% / 2% | ₹50,000 per year | Professional 10%, Technical 2%, No threshold for director remuneration |
| Income from specified mutual funds | 194K | 393 Table 1 S.No.(4)(i) | Any person | 10% | ₹10,000 | Applies only to dividend income |
| Compensation on compulsory acquisition | 194LA | 393 Table 1 S.No.(3)(iii) | Any person | 10% | ₹5,00,000 | — |
| Income distributed by business trust | 194LBA | 393 Table 1 S.No.(4)(ii) | Business trust | 10% | Nil | — |
| Income from investment fund | 194LBB | 393 Table 1 S.No.(4)(iii) | Investment fund | 10% | Nil | — |
| Income from securitisation trust | 194LBC | 393 Table 1 S.No.(4)(iv) | Securitisation trust | 10% | Nil | — |
| Contract / commission / professional fees by Individual/HUF | 194M | 393 Table 1 S.No.(6)(ii) | Individual/HUF | 2% | ₹50 lakh per FY | Applicable when not covered under 194C/194H/194J |
| Cash withdrawals | 194N | 393 Table 3 S.No.(5) | Bank / Post office | 2% | ₹3 crore (co-op society) / ₹1 crore others | Higher TDS for non-ITR filers removed |
| E-commerce participants | 194O | 393 Table 1 S.No.(8)(v) | E-commerce operator | 0.1% | ₹5 lakh (Ind/HUF sellers) | On gross sales |
| Specified senior citizens | 194P | 393 Table 1 S.No.(8)(iii) | Bank | Slab rate | As per slab | Resident senior citizens age 75+ |
| Purchase of goods | 194Q | 393 Table 1 S.No.(8)(ii) | Buyer | 0.1% | ₹50 lakh | Buyer turnover must exceed ₹10 crore |
| Benefit / perquisite | 194R | 393 Table 1 S.No.(8)(iv) | Specified person | 10% | ₹20,000 per FY | From business or profession |
| Virtual digital assets | 194S | 393 Table 1 S.No.(8)(vi) | Buyer | 1% | ₹50,000 specified person / ₹10,000 others | Crypto, NFTs etc. |
| Payment by firm to partners | 194T | 393 Table 3 S.No.(7) | Firm | 10% | ₹20,000 per FY | Salary, commission, bonus, interest |
The Income Tax Act 2025, effective from 1 April 2026, introduces a simplified structure for TDS provisions.
Instead of numerous scattered sections under the earlier law, the new Act reorganizes withholding tax provisions primarily under Sections 392 and 393, supported by structured tables covering different types of payments.
This reform aims to simplify tax compliance, reduce complexity, and make the law easier to understand for taxpayers and professionals.
Disclaimer
The contents of this article are for general informational purposes only and are intended to provide quick access to tax rate information. Readers are advised to verify the provisions with the Income-tax Act, relevant rules, notifications, and official government sources before making financial decisions.
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