Most taxpayers don’t realise this until it’s too late.
Your employer, bank, or client may already be deducting TDS from your income every month—and in many cases, it may be higher than required or applied under the wrong section.
Most people rely on getting a refund later.
But what often goes unnoticed is the impact on monthly cash flow, where your own money remains blocked instead of working for you.
I’ve seen real cases where:
- Freelancers lost thousands due to wrong TDS rates—if you want to understand the actual tax impact, you can check tax on ₹15 lakh salary for a detailed breakdown.
- Property buyers missed mandatory deductions and received income tax notices.
- Salaried individuals struggled to claim refunds due to excess deduction—often due to incorrect filing, so it’s important to understand which ITR form to file for salaried person before submitting your return.
That’s exactly why having a clear, updated TDS Rate Chart for FY 2026–27 is not optional—it’s essential.
👉 In this guide, you can download the latest TDS rate chart (PDF & Excel) and understand exactly which section applies to you—before it impacts your money.
You can also calculate your exact tax liability using our income tax calculator India to ensure you’re not paying more than required.
✔ Updated for FY 2026–27
✔ Includes PDF & Excel download
✔ Section-wise simplified table
TDS Rate Chart (FY 2026-27)
Here is the complete TDS rate chart for FY 2026–27 with section-wise rates and thresholds:
| Nature of Payment | Old Sec | New Sec | New Code | Rate (%) | Threshold (₹) |
| 👤 Salaries (Resident) | 192 | 392 | 1001 | Slab | – |
| 💰 Accumulated PF Balance | 192A | 392(7) | 1004 | 10% | 50,000 |
| 🛡 Insurance Commission | 194D | 393(1) | 1005 | 2% / 10% | 20,000 |
| 🤝 Commission or Brokerage (Others) | 194H | 393(1) | 1006 | 2% | 20,000 |
| 🚜 Rent on Machinery/Equipment | 194I(a) | 393(1) | 1008 | 2% | 50,000 / month |
| 🏢 Rent (Other than Machinery) | 194I(b) | 393(1) | 1009 | 10% | 50,000 / month |
| 🏗️Comp on Acquisition of Property | 194IA | 393(1) | 1012 | 10% | 5,00,000 |
| 🏗️Transfer ofImmovable Property(Other than agricultural land) | 194IA | 393(1) | 1012 | 1% | 50,00,000 |
| 📈 Income from Mutual Funds | 194K | 393(1) | 1013 | 10% | 10,000 |
| 🏦 Interest on Securities | 193 | 393(1) | 1019 | 10% | 10,000 |
| 👴 Interest (Senior Citizen) | 194A | 393(1) | 1020 | 10% | 1,00,000 |
| 💳 Interest (Other – Non Sr. Citizen) | 194A | 393(1) | 1021 | 10% | 50,000 |
| 🛠️ Payment to Contractor (Ind/HUF) | 194C | 393(1) | 1023 | 1% | 30k / 1L |
| 🏗️ Payment to Contractor (Others) | 194C | 393(1) | 1024 | 2% | 30k / 1L |
| 💻 Fees for Technical Services | 194J(a) | 393(1) | 1026 | 2% | 50,000 |
| 🎓 Fees for Professional Services | 194J(b) | 393(1) | 1027 | 10% | 50,000 |
| 👔 Remuneration to Director | 194J(b) | 393(1) | 1028 | 10% | – |
| 💵 Dividends | 194 | 393(1) | 1029 | 10% | – |
| 📜 Life Insurance Policy | 194DA | 393(1) | 1030 | 2% on income portion | 1,00,000 |
| 🛍️ Purchase of Goods | 194Q | 393(1) | 1031 | 0.10% | 50,00,000 |
| 🎁 Business Perquisite/Benefit | 194R | 393(1) | 1033 | 10% | 20,000 |
| 🌐 E-commerce Participation | 194O | 393(1) | 1035 | 0.10% | 5,00,000 |
| 🚀 Virtual Digital Assets (VDA) | 194S | 393(1) | 1037 | 1% | 10,000 |
| 🎟️ Lottery Winnings | 194B | 393(3) | 1058 | 30% | 10,000 |
| 🎮 Online Game Winnings | 194BA | 393(3) | 1060 | 30% | – |
| 🐎 Horse Race Winnings | 194BB | 393(3) | 1062 | 30% | 10,000 |
| 🏧 Cash Withdrawal (Co-op Society) | 194N | 393(3) | 1064 | 2% | 3 Crore |
| 🏦 Cash Withdrawal (Others) | 194N | 393(3) | 1065 | 2% | 1 Crore |
| 🤝 Partner Salary / Interest | 194T | 393(3) | 1067 | 10% | 20,000 |
Note: For payments where PAN is not provided, tax is generally deducted at 20% (or 5% for sections like 194Q).
Most Common TDS Sections Explained as per New Income Tax Act, 2025
Old Section 192 – New Section 392-Salary
TDS on salary is deducted by the employer based on applicable income tax slab after considering deductions and chosen tax regime.
Example:
If your annual salary is ₹12 lakh, your employer estimates total tax and deducts TDS monthly.
⚠️ Common Mistake:
Employees often fail to submit investment proofs on time or choose wrong income tax regimes, leading to higher TDS deduction—even if they are eligible for deductions.
Old Section 194C – New Section 393(1)- Contractor Payments
Applies to payments made to contractors. TDS is deducted at 1% (individual/HUF) or 2% (others).
Example:
₹2,00,000 paid to contractor → TDS ₹2,000 (1%)
⚠️ Common Mistake:
Using the wrong rate (1% vs 2%) or ignoring aggregate yearly limit (₹1 lakh), which can trigger compliance issues.
Section 194J – New Section 393(1)-Professional / Freelancer Fees
Applicable to freelancers, consultants, doctors, etc. TDS is generally 10%.
Example:
₹1,00,000 paid to freelancer → ₹10,000 TDS deducted
⚠️ Common Mistake:
Misclassifying services as “contract” instead of “professional,” leading to lower TDS (1–2%) instead of 10%, which can attract tax notices.
📌 Section 194Q – New Section 393(1)-Purchase of Goods
Applicable when purchases exceed ₹50 lakh. TDS is deducted at 0.1% by the buyer.
Example:
₹60 lakh purchase → TDS ₹10,000 (on ₹10 lakh excess)
⚠️ Common Mistake:
Ignoring the interaction with TCS under Section 206C(1H)—in most cases, TDS under 194Q takes priority, but many businesses apply both incorrectly. Though Section 206C(1H) is not applicable any more under the New Income Tax Act, 2025.
These examples and mistakes are based on real-world compliance issues observed under the Income-tax Act.
For detailed reference, you can refer to the official provisions published by the Income Tax Department India:
👉 Income Tax Act 2025 (Updated PDF)
Source: Official tax provisions as per Income Tax Department India (PDF reference available above)
Download TDS Rate Chart FY 2026–27 (PDF & Excel)
Download the latest TDS Rate Chart for FY 2026–27 in PDF and Excel format for quick reference and practical use.
Whether you are a salaried individual, freelancer, or business owner, these files will help you check TDS rates, thresholds, and applicable sections anytime—without confusion.
TDS Rate Chart FY 2026-27 PDF Download
- Download TDS Rate Chart FY 2026–27 (PDF)
- ✔️ Clean printable format
- ✔️ Section-wise TDS & TCS rates
- ✔️ Ideal for quick offline reference
- 👉 [TDS Rate Chart PDF Download]
TDS Rate Chart FY 2026-27 Excel Download
- Download TDS Rate Chart FY 2026–27 (Excel)
- ✔️ Editable format
- ✔️ Easy filtering & sorting
- ✔️ Useful for professionals and businesses
- 👉 [TDS Rate Chart Excel Download]
These charts are prepared based on updated provisions under the Income-tax Act, 2025 and practical compliance scenarios.
Before you finalize your tax planning, you can also calculate your exact liability using our income tax calculator India.
New Income Tax Calculator
Calculate your tax liability for FY 2026–27 instantly
Important TDS Rules You Must Know
Understanding TDS rules is not just about rates—it’s about avoiding penalties, notices, and cash flow issues. Here are the most critical rules every taxpayer and business should know:
No PAN? TDS Can Go Up to 20%
If the deductee does not provide a valid PAN, TDS is deducted at a higher rate of 20% (or the applicable rate, whichever is higher).
Example:
If professional fees fall under Section 194J (10%), but PAN is not provided, TDS will be deducted at 20% instead of 10%.
Why this matters:
This leads to excess deduction and refund delays, impacting your working capital.
Late Deduction = Interest & Penalty
Failing to deduct or deposit TDS on time attracts interest and penalties under the Income-tax Act, 1961.
Interest provisions:
- 1% per month → for late deduction
- 1.5% per month → for late payment after deduction
Additional risks:
- Late filing fees (Section 234E)
- Disallowance of expenses (Section 40(a)(ia))
Why this matters:
Even small delays can turn into significant financial leakage + compliance risk.
Download TCS Rate Chart for FY 2026–27 (PDF & Excel)
Download the latest TCS Rate Chart for FY 2026–27 in PDF and Excel format for quick reference and practical use.
Whether you are a salaried individual, freelancer, or business owner, these files will help you check TDS rates, thresholds, and applicable sections anytime—without confusion.
TCS Rate Chart FY 2026-27 PDF Download
- Download TCS Rate Chart FY 2026–27 (PDF)
- ✔️ Clean printable format
- ✔️ Section-wise TDS & TCS rates
- ✔️ Ideal for quick offline reference
- 👉 [Download PDF]
TCS Rate Chart FY 2026-27 Excel Download
- Download TCS Rate Chart FY 2026–27 (Excel)
- ✔️ Editable format
- ✔️ Easy filtering & sorting
- ✔️ Useful for professionals and businesses
- 👉 [Download Excel File]
These charts are prepared based on updated provisions under the Income-tax Act, 2025 and practical compliance scenarios.
TDS vs TCS Rate Chart FY 2026–27
TDS (Tax Deducted at Source) and TCS (Tax Collected at Source) are often confused, but they apply at different points in a transaction. Use this quick comparison to know when each one applies.
🔄 TDS vs TCS Quick Comparison
Understand the key differences between TDS (Tax Deducted at Source) and TCS (Tax Collected at Source) in India:
| Basis | TDS (Tax Deducted at Source) | TCS (Tax Collected at Source) |
|---|---|---|
| Who applies tax? | Deductor (payer) | Collector (seller) |
| When applied? | At payment or credit | At sale or receipt |
| Applicable sections | 192, 194C, 194J, 194Q | 206C(1), 206C(1H), 206C(1G) |
| Nature of transaction | Income payments (salary, fees, rent) | Sale transactions (goods, remittance) |
| Who deposits tax? | Deductor | Collector |
| Reflected in | Form 26AS / AIS | Form 26AS / AIS |
| Typical rate | 0.1% – 30% | 0.1% – 20% |
| Purpose | Tax on income payments | Tax on specific sales |
💡 Key Rule: If both TDS under Section 194Q and TCS under Section 206C(1H) apply, TDS takes priority.
Key Use Cases (Very Important)
✅ When TDS Applies
- Salary paid to employees → Section 192
- Contractor payments → Section 194C
- Professional fees → Section 194J
- Purchase of goods > ₹50 lakh → Section 194Q
In all these cases, payer deducts tax before paying
✅ When TCS Applies
- Sale of scrap, minerals → Section 206C
- Sale of motor vehicle > ₹10 lakh → Section 206C(1F)
- Foreign remittance (LRS) → Section 206C(1G)
- Sale of goods > ₹50 lakh → Section 206C(1H)
Here, seller collects tax from buyer
Simple Way to Remember
- TDS = Deduct while paying
- TCS = Collect while selling
Latest Updates in TDS for FY 2026–27
The financial year 2026-27 marks a definitive shift in Indian taxation. With the full implementation of the Income Tax Act, 2025, we have moved from a fragmented system to a unified, code-driven framework.
Here is what you need to manage for a smooth compliance year:
Smart Threshold Adjustments
Several key limits have been recalibrated to simplify compliance for small businesses while widening the tax net:
- Partnership Payments (Section 194T): For the first time, salary, interest, and bonuses paid to partners are subject to TDS. With a threshold of ₹20,000, most professional firms must now factor this into their monthly accounting.
- Strengthened Aggregates (Section 393): While the single-payment limit for contractors (194C) remains ₹30,000, the focus is now on the ₹1,00,000 annual aggregate. Diligent tracking is no longer optional.
- Luxury Standardization: Thresholds for TCS on high-value goods (watches, art, luxury bags) are now standardized at ₹10 Lakhs, simplifying the 1% collection trigger for premium retailers.
The “Code-First” Simplification
The government’s new “Table-based” model ends decades of classification disputes:
- Centralized Reporting: Domestic TDS is now consolidated under Section 393, replacing over 50 legacy sections.
- 4-Digit Return Codes: Compliance is now driven by 1000-series codes (e.g., 1027 for Professional Fees). This move enables better automation and drastically reduces “Defective Return” notices.
- Precise Definitions: The Act now clearly separates Technical Services (2%) from Professional Services (10%) within the same table, giving businesses a clearer roadmap for deduction.
Legality: The Income Tax Act 2025 is Here
There is no longer any ambiguity regarding the transition:
- Primary Law: As of April 1, 2026, the Income Tax Act, 2025 is the only governing law. The legacy 1961 Act has been officially superseded for current transactions.
- System Overhaul: Digital portals and legal forms (24Q, 26Q) now prioritize 300-series sections. It is mandatory for deductors to update their ERP systems to reflect these new codes to avoid processing delays and interest penalties.
ArthikDisha Tip: Never overlook a vendor’s PAN status. Under the 2025 Act, the penalty for an “Inoperative PAN” remains a flat 20% deduction, regardless of the thresholds mentioned above.
Which TDS Section Applies to You?
Choosing the right section is no longer just a compliance step—it’s a cash-flow strategy. Misclassification can lead to either a 20% penalty or blocked working capital.
| If You Are Paying… | Old Sec. | New Code | New Sec. | Rate |
|---|---|---|---|---|
| Regular Salaries | 192 | 1001 | 392 | Slab Rates |
| Freelancers / Professional Fees | 194J(b) | 1027 | 393(1) | 10% |
| Tech Services / Call Centres | 194J(a) | 1026 | 393(1) | 2% |
| Property Purchase (> ₹50L) | 194IA | 1012 | 393(1) | 1% |
Strategic Insight: For payments to professionals, always check if the service is “Technical” or “Professional.” Shifting from Code 1027 (10%) to Code 1026 (2%) where legally applicable can save your business 8% in immediate working capital.
Expert FAQ: TDS Rate Chart FY 2026–27
The TDS rate varies from 0.1% to 10% depending on the type of payment such as salary, contractor payments, professional fees, rent, and purchase of goods. Some special cases like lottery or winnings may attract higher rates up to 30%.
Yes, you can download the TDS rate chart in Excel format for easy filtering, calculations, and professional use. This is especially useful for businesses, accountants, and tax planning purposes.
Yes, TDS is refundable if excess tax has been deducted. You can claim the refund while filing your Income Tax Return (ITR). The refund is processed after verification based on your total income and tax liability.
Section 194T mandates TDS on partner salary and interest at 10%. However, share of profit remains outside TDS scope.
Strategy
Firms may evaluate restructuring agreements to allocate higher profit share and lower salary to optimize partner cash flow.
There is a significant gap between technical services (2%) and professional services (10%) under TDS.
Strategy
Clearly define service nature in agreements (SLA) to justify classification and avoid higher deduction during audits.