Latest TDS Rates Table – Financial Year 2026–27

TDS Rates Comparison Chart for FY 2026–27 (Old vs New Act with Section Codes)                                                       TDS provisions have been updated in the Income Tax Act, 2025. Below is a detailed rate chart with old section references and corresponding new section codes.

TDS Rate Chart – FY 2026–27

(Old Act vs New Income Tax Act, 2025 – Sections & Codes)

With the implementation of the Income Tax Act, 2025, TDS provisions have been restructured and renumbered. While most rates and thresholds remain largely unchanged, the section references have shifted significantly.

Below is a comprehensive comparative chart mapping old sections with new section codes, along with applicable thresholds and TDS rates.

👤 Payment to Residents

Nature of Payment Old Section New Section (2025 Act) Threshold Rate
Salary 192 392(1) Basic exemption Slab
EPF Withdrawal 192A 392(7) ₹50,000 10%
Interest on Securities 193 393(1) Table Sl. 5(i) ₹10,000 10%
Dividend 194 393(1) Table Sl. 7 ₹10,000 (Individual) 10%
Interest (Senior Citizen) 194A 393(1) Table 5(ii)(D)(a) ₹1,00,000 10%
Interest (Others) 194A 393(1) Table 5(ii)(D)(b) ₹50,000 10%
Insurance Commission 194D 393(1) Table 1(i) ₹20,000 2% / 10%
Commission/Brokerage 194H 393(1) Table 1(ii) ₹20,000 2%
Rent (General) 194I 393(1) Table 2(i) ₹50,000 2%
Rent (Machinery) 194I 393(1) Table 2(ii)(D)(a) ₹50,000 2%
Rent (Land/Building) 194I 393(1) Table 2(ii)(D)(b) ₹50,000 10%
Purchase of Immovable Property 194-IA 393(1) Table 3(i) ₹50 lakh 1%
Compensation on Acquisition 194LA 393(1) Table 3(ii) ₹5 lakh 10%
Mutual Fund Income 194K 393(1) Table 4(i) ₹10,000 10%
Business Trust Income 194LBA 393(1) Table 4(ii) Nil 10%
Investment Fund Income 194LBB 393(1) Table 4(iii) Nil 10%
Securitisation Trust Income 194LBC 393(1) Table 4(iv) Nil 10%

🏢 Contract / Professional / Business Payments

Nature Old Section New Section Threshold Rate
Contractor (Individual/HUF) 194C 393(1) Table 6(i)(D)(a) ₹30,000 / ₹1 lakh 1%
Contractor (Others) 194C 393(1) Table 6(i)(D)(b) ₹30,000 / ₹1 lakh 2%
Individual/HUF paying Contractor/Professional 194M 393(1) Table 6(ii) ₹50 lakh 2%
Technical Services / Royalty 194J 393(1) Table 6(iii)(D)(a) ₹50,000 2%
Professional Services 194J 393(1) Table 6(iii)(D)(b) ₹50,000 10%
Director Remuneration 194J 393(1) Table 6(iii)(D)(b) No limit 10%

🔄 Special Transactions

Nature Old Section New Section Threshold Rate
Purchase of Goods 194Q 393(1) Table 8(ii) ₹50 lakh 0.10%
Benefit/Perquisite 194R 393(1) Table 8(iv) ₹20,000 10%
E-commerce Operator 194O 393(1) Table 8(v) ₹5 lakh (Ind/HUF) 0.10%
Virtual Digital Assets (Non-Individual) 194S 393(1) Table 8(vi) ₹10,000 1%
VDA (Individual/HUF) 194S 393(1) Table 8(vi) ₹50,000 1%
Life Insurance (Taxable Portion) 194DA 393(1) Table 8(i) ₹1,00,000 2%

🌍 Non-Resident Payments

Nature Old Section New Section Rate
General Payment to Non-resident 195 393(2) As per Act/DTAA
Interest on Foreign Loan 194LC 393(2) Table 2 5%
Infra Debt Fund 194LB 393(2) Table 5 5%
Rupee Bonds (IFSC pre-2023) 194LC 393(2) Table 4E(a) 4%
Rupee Bonds (post-2023) 194LC 393(2) Table 4E(b) 9%
Investment Fund Income 194LBB 393(2) Table 8 10% / 30%
Securitisation Trust 194LBC 393(2) Table 9 10% / 30%
Mutual Fund Units 196A 393(2) Table 10 20%
Units (Sec 208) 196A 393(2) Table 11 10%
LTCG (Units) 196A 393(2) Table 12 12.5%
Bonds / GDR Interest 196C 393(2) Table 13 10%
LTCG (Bonds/GDR) 196C 393(2) Table 14 12.5%
Securities Income 196D 393(2) Table 15 20%

🎯 Winnings / High-Rate TDS

Nature Old Section New Section Threshold Rate
Lottery / Puzzle 194B 393(3) Table 1 ₹10,000 30%
Online Gaming 194BA 393(3) Table 2 No limit 30%
Horse Race 194BB 393(3) Table 3 ₹10,000 30%
Lottery Commission 194G 393(3) Table 4 ₹20,000 2%

💵 TDS on Cash Withdrawal

Nature Old Section New Section Threshold Rate
Co-operative Society 194N 393(3) Table 5D(a) ₹3 crore 2%
Others 194N 393(3) Table 5D(b) ₹1 crore 2%

⚠️ Important Note – Section 397 (PAN Not Furnished)

If PAN is not provided, TDS will be higher of:

  • Applicable rate, or
  • 20%

📌 Disclaimer

The contents of this article are for general informational purposes only and intended to provide a quick reference to TDS rates. Readers are advised to verify provisions with the Income Tax Act, applicable rules, notifications, and official government sources before making any financial or compliance decisions.

Tax Deduction on Property Transactions – (Sec 194-IA / Sec 393(1)): Comparing Form 26QB and Form 141

TDS on Property Transactions – Updated Compliance Guide (Section 194-IA to Section 393(1))

The provisions relating to Tax Deducted at Source (TDS) on the purchase of immovable property have undergone an important transition with the introduction of the Income Tax Act, 2025. Earlier governed under Section 194-IA of the Income Tax Act, 1961, these provisions will now fall under Section 393(1) effective from 1 April 2026.

While the fundamental principle of TDS deduction on property transactions remains unchanged, the compliance structure, documentation, and procedural requirements have been streamlined and reorganized. This makes it crucial for buyers, sellers, and tax professionals to stay updated and ensure proper compliance.

🔍 Overview of TDS on Property

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  • Applicable on purchase of immovable property (excluding agricultural land)
  • TDS is required to be deducted by the buyer
  • Triggered when property value exceeds ₹50 lakh
  • Deduction is made at the time of payment or credit, whichever is earlier

📊 Key Changes: Section 194-IA vs Section 393(1)

Particulars Section 194-IA (Old Law) Section 393(1) (New Law – from 01.04.2026)
Applicable Law Income Tax Act, 1961 Income Tax Act, 2025
Effective Date Till 31 March 2026 From 1 April 2026
Threshold Limit ₹50 lakh Likely retained (no major change expected)
TDS Rate 1% Expected to remain similar
Compliance Forms Form 26QB New forms such as Form 141
System TRACES-based Updated compliance system

📝 Forms for Compliance: Form 26QB vs Form 141

✔️ Form 26QB (Existing System)

  • Challan-cum-statement for reporting TDS on property
  • Filed within 30 days from end of month of deduction
  • Required for generating Form 16B (TDS certificate)

✔️ Form 141 (New Framework)

  • Introduced under the new Act for TDS reporting
  • Designed to simplify filing and improve tracking
  • Expected to integrate better with the new tax compliance ecosystem

⚙️ Step-by-Step TDS Compliance Process

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  1. Verify Applicability
    Ensure property value exceeds ₹50 lakh and is not agricultural land
  2. Deduct TDS
    Deduct applicable TDS (generally 1%) at time of payment
  3. Deposit TDS
    Pay TDS to the government within prescribed timeline
  4. File Relevant Form
    • Up to FY 2025-26 → File Form 26QB
    • From FY 2026-27 → File Form 141
  5. Issue TDS Certificate
    Provide Form 16B (or equivalent under new law) to seller

⚠️ Important Points to Remember

  • PAN of both buyer and seller is mandatory
  • Higher TDS may apply if PAN is not available
  • Each buyer–seller combination requires separate compliance
  • Delay may lead to interest and penalties

📌 Conclusion

The shift from Section 194-IA to Section 393(1) represents more of a structural and procedural update rather than a conceptual change. However, the introduction of new forms like Form 141 and changes in compliance systems make it essential for taxpayers to adapt quickly.

Staying compliant will ensure smooth property transactions, avoid penalties, and maintain proper tax records under the new regime.

🏠 TDS on Property Transactions – Detailed Compliance & Latest Tax Law Updates

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📌 Applicability of TDS on Property

TDS on property becomes applicable when any person purchases immovable property (land, building, or part thereof) for a consideration of ₹50 lakh or more. This provision applies to both residential and commercial properties, while agricultural land is specifically excluded.

It is important to note that the ₹50 lakh threshold is based on the total property value, not on individual instalments. Even if payments are made in parts, once the aggregate value crosses ₹50 lakh, TDS provisions will apply.

💰 TDS Rate and PAN Requirement

  • Standard TDS rate: 1% of sale consideration
  • If seller does not provide PAN: TDS may increase significantly (generally up to 20%)

Ensuring the seller’s PAN is correctly obtained and verified is essential to avoid higher tax deduction.

⏱️ Timing of TDS Deduction

TDS must be deducted at the time of payment or credit, whichever is earlier.

This means:

  • Advance payments and instalments are also subject to TDS
  • Particularly important during financial year transitions, such as the shift to the new law from April 2026

🔄 Tax Law Update – Change in Compliance Forms

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With the introduction of the Income Tax Act, 2025, the compliance mechanism has been updated:

  • Up to 31 March 2026 → TDS filing through Form 26QB
  • From 1 April 2026 onwards → TDS filing through Form 141

Both forms must be filed within 30 days from the end of the month in which TDS is deducted.

👉 The date of payment determines which form is applicable—not the agreement date.

🔍 Transitional Scenario (Important)

  • Agreement signed before March 2026 but payment made after April 2026 → Form 141 applies
  • Payment made before April 2026 → Form 26QB applies

In case of multiple instalments across both periods, compliance may be required under both forms.

👥 Multiple Buyers or Sellers

  • TDS applicability depends on total property value, not individual share
  • Even if individual shares are below ₹50 lakh, TDS still applies if total exceeds threshold
  • Separate compliance may be required for each buyer–seller combination

🧾 Responsibility of Buyer

The buyer is responsible for:

  • Deducting TDS
  • Depositing it with the government
  • Filing the applicable form (26QB / 141)
  • Issuing TDS certificate to the seller (earlier Form 16B, similar system expected)

⚠️ Consequences of Non-Compliance

  • 1% per month interest for failure to deduct TDS
  • 1.5% per month interest for failure to deposit TDS
  • Late filing fee: ₹200 per day (subject to TDS amount)

Timely compliance is critical to avoid penalties and interest.

📘 Conclusion

Although the core concept of TDS on property remains unchanged, the shift to the new law introduces updated sections and revised compliance forms. The most crucial factor is the timing of payment, which determines whether Form 26QB or Form 141 should be used.

A clear understanding of these provisions ensures accurate compliance, smooth property transactions, and avoidance of penalties.

Income Tax Changes Announced in Union Budget 2026

Direct Tax Proposals in Budget 2026 – Key Highlights

In Union Budget 2026, the Government has announced a wide-ranging and future-oriented set of Direct Tax reforms aimed at simplifying tax laws, reducing disputes, improving compliance, and enhancing India’s appeal as a global investment destination. These measures signal a decisive shift from a complex, enforcement-driven regime to a trust-based, technology-enabled, and taxpayer-friendly tax system, aligned with the vision of Viksit Bharat.

1. New Income-tax Act, 2025 – A Structural Overhaul

One of the most significant announcements in Budget 2026 is the replacement of the Income-tax Act, 1961 with the Income-tax Act, 2025, effective from 1 April 2026.

The new legislation is designed to:

  • Be substantially shorter and simpler, with fewer sections and chapters

  • Use clear and unambiguous language to minimise interpretational disputes

  • Be easier for taxpayers and tax authorities to understand and implement

Simplified Income-tax Rules and redesigned return forms will be notified shortly, enabling individuals to comply without professional assistance.

2. Taxpayer Relief & Ease of Living Measures

The Budget introduces multiple measures to address long-standing taxpayer concerns:

MACT Interest Exemption

  • Interest awarded by the Motor Accident Claims Tribunal (MACT) to individuals will be fully exempt from tax.

  • No TDS will apply, irrespective of the amount received.

Rationalisation of TCS under LRS

  • TCS on overseas tour packages reduced to 2% (from 5% / 20%), without any threshold.

  • TCS on education and medical remittances under LRS reduced from 5% to 2%.

Clarity on TDS for Manpower Supply

  • Manpower supply services classified as contractor payments.

  • TDS rate capped at 1% / 2%, eliminating ambiguity and litigation.

Automated Lower / Nil TDS Certificates

  • Eligible small taxpayers can obtain lower or nil TDS certificates through an automated, rule-based system without Assessing Officer interaction.

Simplification of Form 15G / 15H

  • Depositories authorised to accept declarations centrally and share them with multiple companies, reducing repetitive filings.

3. Rationalised Return Filing Timelines

To ease compliance pressure:

  • Belated and revised returns can now be filed up to 31 March (earlier 31 December) on payment of a nominal fee.

  • Staggered ITR due dates introduced:

    • ITR-1 & ITR-2 (Individuals): 31 July

    • Non-audit cases and trusts: 31 August

4. Relief for Property Transactions Involving NRIs

For purchase of immovable property from a non-resident:

  • Resident buyers are no longer required to obtain a TAN.

  • TDS can be deposited using a PAN-based challan, similar to resident transactions.

5. One-Time Foreign Asset Disclosure Scheme (FAST-DS, 2026)

A special 6-month disclosure window has been introduced for genuine hardship cases involving small taxpayers.

Category A

  • Undisclosed foreign income / assets up to ₹1 crore

  • Payment of:

    • 30% tax

    • 30% additional tax (in lieu of penalty)

  • Immunity from prosecution granted

Category B

  • Foreign assets up to ₹5 crore

  • One-time fee of ₹1 lakh

  • Full immunity from penalty and prosecution

Immunity from prosecution is also retrospectively extended for non-immovable foreign assets up to ₹20 lakh.

6. Rationalisation of Penalty & Prosecution Regime

Key reforms include:

  • Assessment and penalty proceedings to be concluded through a single consolidated order

  • No interest on penalty amounts during pendency of first appeal

  • Pre-deposit for appeal reduced from 20% to 10%, limited to core tax demand

Updated Returns Post Reassessment

  • Taxpayers can file updated returns even after reassessment initiation by paying an additional 10% tax.

Penalty to Fee Conversion

  • Certain technical defaults (audit, TP report, SFT) converted into fee-based non-criminal defaults.

Decriminalisation Measures

  • Minor offences punishable only with fines

  • Maximum imprisonment reduced to two years

  • Penalties graded based on tax evasion quantum

7. Targeted Tax Relief for Cooperatives

  • Deduction extended to supply of cattle feed and cotton seed by primary cooperatives

  • Inter-cooperative dividend income allowed as deduction under the new tax regime

  • Three-year dividend exemption for notified national cooperative federations, subject to redistribution

8. IT Sector Boost & Transfer Pricing Certainty

  • IT and IT-enabled services consolidated under “Information Technology Services”

  • Uniform safe harbour margin of 15.5%

  • Threshold enhanced from ₹300 crore to ₹2,000 crore

  • Automated safe harbour approvals valid for 5 years

  • Fast-track unilateral APA with targeted 2-year resolution

9. Measures to Attract Global Business & Talent

  • Tax holiday till 2047 for foreign cloud service providers using Indian data centres

  • 15% safe harbour margin for data-centre support entities

  • 5-year tax exemption for non-residents supplying capital goods to bonded zone manufacturers

  • Exemption of global income for foreign experts residing in India up to 5 years

  • MAT exemption for non-residents taxed on presumptive basis

10. Tax Administration Reforms

  • ICDS to be merged with Ind-AS from FY 2027-28

  • Definition of “accountant” rationalised to support global expansion of Indian advisory firms

11. Other Key Direct Tax Measures

  • Buyback taxation shifted to capital gains for all shareholders

  • Additional tax for promoters to prevent arbitrage

  • TCS on liquor, scrap and minerals reduced to 2%; tendu leaves from 5% to 2%

  • STT increased on futures and options

  • MAT to become final tax from 1 April 2026, rate reduced to 14%, with limited MAT credit set-off

Conclusion

The Direct Tax proposals in Budget 2026 mark a bold move towards simplicity, certainty, and trust-based taxation. With a new Income-tax Act, substantial compliance relief, rationalised penalties, and strong incentives for investment and global integration, the reforms aim to strike a balance between revenue mobilisation and taxpayer confidence, supporting long-term economic growth.