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TDS rate chart 2026-27 (section 393)
From 1 April 2026 the Income-tax Act, 2025 replaced the 1961 Act. TDS on salary is now section 392 and almost every other TDS, which used to be sections 193 to 194T, is one section, 393, with tables. The rates and limits for business payments stayed as they were after the Finance Act 2025.
The common business payments
| Payment | Old section | Rate | No TDS up to |
|---|---|---|---|
| Contractor or sub-contractor | 194C | 1% individual/HUF, 2% others | ₹30,000 a bill and ₹1,00,000 in the year |
| Professional fees | 194J | 10% | ₹50,000 in the year |
| Technical services, call centre, film royalty | 194J | 2% | ₹50,000 in the year |
| Director's fees (not salary) | 194J | 10% | No limit |
| Commission or brokerage | 194H | 2% | ₹20,000 in the year |
| Rent of land, building, furniture | 194I | 10% | ₹50,000 a month |
| Rent of plant and machinery | 194I | 2% | ₹50,000 a month |
| Rent by an individual/HUF not under audit | 194-IB | 2% | ₹50,000 a month |
| Interest other than bank/post office | 194A | 10% | ₹10,000 in the year |
| Contract/professional work paid by an individual/HUF not under audit | 194M | 2% | ₹50 lakh in the year |
| Purchase of goods (buyer turnover above ₹10 crore) | 194Q | 0.1% of the amount above ₹50 lakh | ₹50 lakh from one seller in the year |
| Partner's salary, commission, interest | 194T | 10% | ₹20,000 in the year |
All of these are now in section 393. For payments made before 1 April 2026, use the old section numbers; those years are still governed by the 1961 Act.
Things that change the amount
- No PAN: the higher of 20% or twice the rate (5% for purchase of goods).
- GST: when GST is shown separately on the bill, TDS is worked out on the amount without GST (this was CBDT Circular 23/2017 under the old Act; follow the same practice unless your accountant advises otherwise).
- Transporters: a transporter with 10 or fewer goods carriages who gives a declaration with PAN is paid without TDS under the contractor rule.
- Lower-deduction certificate: if the payee shows one from the department, use the rate on it.
TCS: only a few cases now
TCS on sale of goods above ₹50 lakh (old section 206C(1H)) was removed from 1 April 2025. Other TCS (old 206C, now section 394) applies only to special goods such as scrap, minerals, forest produce and motor vehicles above ₹10 lakh, and to some foreign remittances. Most shops and traders no longer collect TCS on their bills.
Example
A Pune firm pays a CA ₹40,000 in June and ₹35,000 in November 2026. June: total ₹40,000, within ₹50,000, no TDS. November: the year's total becomes ₹75,000, above ₹50,000, so TDS is due on the whole ₹75,000, including June's payment: 10% = ₹7,500, cut from the November payment (the CA receives ₹27,500). If the CA had not given a PAN: 20%, ₹15,000.