TDS Rate Chart FY 2025-26: All Sections & Rates

New financial year, new TDS rates to worry about. If you're in finance, you know the drill, every April, the rates and thresholds shift, and you've got to make sure your systems catch up before the first payment run. Miss the update, and you're staring at short-deduction notices by July.

For FY 2025-26 (Assessment Year 2026-27), the Union Budget brought several changes that directly affect how companies deduct and deposit TDS (Tax Deducted at Source) on salaries, vendor payments, rent, professional fees, and more. This rate chart covers every major section, the applicable percentage, threshold limits, and practical notes. Bookmark it: your accounts team will need it all year.

TDS in 30 Seconds

TDS is the government's way of collecting income tax at the source (when the income is generated) rather than waiting for the recipient to pay at year-end. As a deductor, you're required to deduct TDS at prescribed rates, deposit it with the government, file quarterly TDS returns, and issue TDS certificates to deductees.

You need a valid TAN (Tax Deduction Account Number). Your deductees need a valid PAN. If they don't furnish one, Section 206AA kicks in: TDS at 20% or the applicable rate, whichever is higher.

Complete TDS Rate Chart for FY 2025-26

TDS on Salary and Employee Payments

Section 192: Salary: TDS at the applicable income tax slab rates, based on each employee's estimated total income for the year. Factor in 80C/80D declarations, HRA exemptions, and the standard deduction of Rs 75,000 (up from Rs 50,000 per Budget 2024). Old regime or new regime (the employer deducts based on the employee's choice.

Section 192A) Premature EPF withdrawal: 10% on withdrawals exceeding Rs 50,000. No PAN? TDS at the maximum marginal rate (~34.6%).

TDS on Payments to Contractors and Sub-Contractors

Section 194C: Contractor payments:

• Rate: 1% for individual/HUF contractors; 2% for companies, firms, and other entities
• Threshold: Rs 30,000 per single payment or Rs 1,00,000 aggregate during the financial year
• Watch out: Transporters owning 10 or fewer goods carriages who furnish a PAN declaration are exempt under Section 194C(6). Don't deduct on them.

TDS on Professional and Technical Fees

Section 194J: Professional/technical fees, royalty, and non-compete fees:

• Rate: 2% for technical services (including call centre operators); 10% for professional fees, royalty, and non-compete consideration
• Threshold: Rs 30,000 per year per payee
• The grey area: "Technical services" at 2% vs. "professional services" at 10%: this distinction keeps tax tribunals busy. Software development? Usually 194J at 10%. Routine IT support? Could qualify as technical services at 2%. Get your vendor classification right or pay for it later.

TDS on Rent

Section 194I: Rent:

• Rate: 2% for plant and machinery; 10% for land, building, furniture, or fittings
• Threshold: Rs 2,40,000 per year per payee

Section 194IB: Rent paid by individuals/HUFs (not under tax audit):

• Rate: 5% on monthly rent exceeding Rs 50,000
• Note: This one's for individual and HUF tenants not liable for tax audit. TDS is deducted once: in the last month of the tenancy or the last month of the financial year, whichever comes first.

TDS on Interest Payments

Section 194A: Interest other than on securities:

• Rate: 10%
• Threshold: Rs 40,000 per year from banking companies (Rs 50,000 for senior citizens); Rs 5,000 per year from others
• Exemption: Deductees can submit Form 15G or 15H (senior citizens) for nil deduction if total income falls below the taxable limit

Section 193: Interest on securities:

• Rate: 10%
• Threshold: Rs 10,000 per year on listed debentures (no threshold for others)

TDS on Commission and Brokerage

Section 194H: Commission or brokerage:

• Rate: 5%
• Threshold: Rs 15,000 per year

TDS on E-Commerce Transactions

Section 194O: E-commerce operator payments:

• Rate: 1% on gross amount of sale of goods or services facilitated through the platform
• Threshold: Rs 5,00,000 per year for individual/HUF sellers; no threshold for others
• Note: The TDS obligation sits with the e-commerce operator, not the buyer

TDS on Dividends and Winnings

Section 194 (Dividends: 10%, threshold Rs 5,000 per year.

Section 194B) Lottery and game show winnings: 30%, no threshold (applies on the entire amount.

Section 194BA) Online gaming winnings: 30% on net winnings at withdrawal or at financial year-end.

TDS on Immovable Property

Section 194IA: Transfer of immovable property: 1% on sale consideration exceeding Rs 50,00,000.

Other Sections Worth Knowing

Section 194DA (Insurance maturity proceeds: 5% on income component exceeding Rs 1,00,000.

Section 194G) Lottery ticket commission: 5% above Rs 15,000.

Section 194K (Mutual fund income: 10% above Rs 5,000.

Section 194T) Payments to partners (brand new for FY 2025-26): 10% on salary, remuneration, bonus, commission, or interest paid by a firm to its partners, threshold Rs 20,000 per year. This one's new (make sure your partnership firms are set up for it.

Section 195) Payments to non-residents: Rates per the Income Tax Act or the applicable DTAA (Double Taxation Avoidance Agreement), whichever benefits the deductee. Common rates: 10% for royalties and technical services, 20% as the general catch-all.

"Applying last year's rates for even one quarter will get you a short-deduction notice and interest under Section 201(1A). It happens every single year. Update your rate tables before April 1, not after."

Higher TDS Rates: Sections 206AA and 206AB

Two provisions can override everything in the chart above:

Section 206AA, No PAN furnished: TDS at the higher of the section-specific rate, 20%, or the rate in force. For most payments, this means 20%.

Section 206AB: Specified person (non-filer): If the deductee hasn't filed income tax returns for the two preceding years and had aggregate TDS/TCS exceeding Rs 50,000 in each year, you deduct at the higher of twice the specified rate, twice the rate in force, or 5%. Check specified person status on the TRACES compliance check facility before every payment run.

TDS Deposit and Return Filing Deadlines

Knowing the right rate is only half the job. You also need to deposit on time and file returns by the deadline:

Monthly deposit deadlines:

• TDS deducted in any month (except March): by the 7th of the following month
• TDS deducted in March: by 30th April

Quarterly return filing deadlines (FY 2025-26):

• Q1 (April-June): 31st July 2025
• Q2 (July-September): 31st October 2025
• Q3 (October-December): 31st January 2026
• Q4 (January-March): 31st May 2026

TDS certificate issuance deadlines:

• Form 16 (salary): 15th June following the financial year
• Form 16A (non-salary): within 15 days from the due date of furnishing the TDS return

Miss a return filing deadline and Section 234E hits you with Rs 200/day, capped at the TDS amount. Go beyond one year without filing, and Section 271H adds a penalty of Rs 10,000 to Rs 1,00,000 on top.

For every compliance deadline in one place, see our Complete Annual Compliance Calendar for Indian Businesses (2025-26).

How OneFinOps Helps

Thirty-plus sections, each with its own rate and threshold, updated every Budget. Tracking all of this manually across hundreds of vendors? That's a full-time job for someone, or it's a feature in OneFinOps.

The platform keeps an always-current rate engine that reflects Budget changes and CBDT notifications. It maps payment types to sections automatically, applies the right rate based on vendor profile, tracks thresholds across the financial year, and catches PAN/206AB issues before you process the payment. When quarter-end comes, return data is already in TRACES-compatible format. Review, submit, done. Stop looking up rates in PDF charts.

Wrapping Up

FY 2025-26 brings rationalised rates, new sections like 194T, updated thresholds, and the same old 206AA/206AB higher-rate provisions that trip up teams every year. Update your systems before April 1.

Use this chart as your day-to-day reference, but pair it with solid automation that applies these rates as payments are processed, not after. For the return filing process, read our Complete Guide to TDS Return Filing: Forms 24Q, 26Q, 27Q. And if your firm manages TDS across multiple clients, see how to save 15 hours per week on repetitive compliance work.