Rates & sections
10 common TDS questions on rates & sections, answered by a CA firm and kept current for FY 2026-27.
What is the TDS rate on contractor payments under Section 194C for FY 2026-27?
1% if the contractor is an individual/HUF and 2% for any other contractor, once payments cross ₹30,000 for a single bill or ₹1,00,000 in agg…
When is TDS under Section 194J deducted at 10% and when at 2%?
Professional fees attract 10%, while fees for technical services (and call-centre/royalty for film sale) attract 2% — above a ₹50,000 annual…
What is the threshold and rate for TDS on rent under Sections 194-I and 194-IB?
Businesses deduct under 194-I (10% on land/building, 2% on plant & machinery); individuals/HUF not under audit deduct 2% under 194-IB on…
Is TDS applicable on the purchase of goods under Section 194Q?
Yes — a buyer whose turnover exceeded ₹10 crore in the previous year deducts 0.1% on the value of goods purchased from a seller above ₹50 la…
What rate of TDS applies if the deductee does not give a PAN?
20%, or the normal rate if that is higher — under Section 397(2) of the Income-tax Act 2025 (earlier Section 206AA).…
Is TDS deducted on the GST component of an invoice?
No — where GST is shown separately on the invoice, TDS is deducted only on the value excluding GST.…
Does my firm need to deduct TDS on a partner's remuneration or interest (Section 194T)?
Yes — from 1 April 2025, firms and LLPs deduct 10% TDS on salary, remuneration, interest, bonus or commission paid to a partner once it exce…
What is the TDS rate and threshold on commission or brokerage under Section 194H?
2% once commission or brokerage exceeds ₹20,000 in the financial year.…
What is the TDS rate and threshold on interest (other than securities) under Section 194A?
10%, with the threshold depending on payer and payee — ₹1,00,000 for senior citizens on bank interest, ₹50,000 for others on bank/co-op/post…
Is TDS deducted on reimbursement of expenses?
Pure reimbursements billed separately on actuals usually do not attract TDS; but if reimbursement is bundled into a composite service bill, …
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