Section 393

The key TDS rates under Section 393 of the Income Tax Act 2025 for Tax Year 2026-27 are: Salary (S.392) — average rate; Bank interest — 10% (threshold: ₹50,000; ₹1 lakh for senior citizens); Dividends — 10%; Contractor payments — 1%/2%; Commission/brokerage — 5%; Rent (land/building) — 10%; Professional fees — 10%; Technical services — 2%; Property purchase — 1%; Partner salary/interest — 10%; VDA/Crypto — 1%; Online gaming — 30%; Lottery winnings — 30%; LRS overseas remittance — 20%. No PAN: TDS at 20% or applicable rate, whichever is higher.

Under the Income Tax Act 2025, all TDS sections from ITA 1961 are consolidated into Section 393. Key mappings: Section 192 (salary TDS) → Section 392; Section 194A (interest TDS) → Section 393 Table 1; Section 194C (contractor TDS) → Section 393 Table 1; Section 194H (commission TDS) → Section 393 Table 1; Section 194I (rent TDS) → Section 393 Table 1; Section 194J (professional/technical fees) → Section 393 Table 1; Section 194S (VDA/crypto TDS) → Section 393 Table 5; Section 194BA (online gaming TDS) → Section 393 Table 5; Section 195 (non-resident TDS) → Section 393 Table 2; Section 206C (TCS) → Section 394; Section 194T (partner salary TDS) → Section 393 Table 1.

Yes — the TDS threshold on bank interest has been significantly increased under Section 393 Table 1 of the Income Tax Act 2025. For regular individuals: threshold raised from ₹10,000 to ₹50,000 per year. For senior citizens (aged 60+): threshold raised from ₹40,000/₹50,000 to ₹1,00,000 per year. This means banks will not deduct TDS unless your annual interest from a single bank exceeds ₹50,000 (or ₹1 lakh for senior citizens). However, the income is still taxable in your ITR — the higher threshold simply reduces TDS deductions.

Form 15G and Form 15H have been MERGED into a single Form 121 under the Income Tax Rules 2026. Old Form 15G (for individuals below 60 claiming no TDS on interest) and old Form 15H (for senior citizens) are replaced by the unified Form 121. The purpose is the same: submit this declaration to your bank, employer, or other payer at the beginning of the tax year to request no TDS deduction, provided your estimated total income is below the taxable limit. Form 121 is available on the income tax portal and is submitted electronically.

Under Section 392 of the Income Tax Act 2025, an employee must declare their tax regime choice to the employer at the beginning of each tax year. If no declaration is made, the employer defaults to the new tax regime (Section 202). Based on the declared regime, the employer computes estimated annual tax (accounting for declared investments via Form 12BB for old regime), divides by 12, and deducts that amount monthly as TDS. Employees can change their regime declaration mid-year — the employer adjusts future TDS accordingly. The final regime choice is confirmed at ITR filing.

Under Section 393 Table 1 of the Income Tax Act 2025 (equivalent to old Section 194IA), TDS on purchase of immovable property is 1% of the consideration. Applicable when property value is ₹50 lakh or more. The BUYER must deduct TDS at the time of payment and deposit it using Form 26QB on the income tax portal within 30 days of the month-end. The buyer then issues Form 16B as the TDS certificate to the seller. Important: the 1% TDS is applicable on the full sale consideration (not just the stamp duty value), and if there are multiple buyers, each buyer deducts on their share.

Yes — under the Income Tax Act 2025, Section 393 Table 1 includes TDS on partner salary, interest, commission, and remuneration paid by a firm to its partners at 10%. This provision (equivalent to Section 194T introduced in ITA 1961 from FY 2024-25) is now embedded in ITA 2025. Threshold: ₹20,000 per year per partner. Applicable from Tax Year 2025-26 onwards. This affects all partnership firms and LLPs — they must deduct TDS at 10% on amounts paid to partners (salary, interest on capital, commission) if the aggregate exceeds ₹20,000 in the Tax Year.

Under Section 393 Table 5 of the Income Tax Act 2025 (equivalent to old Section 194S), TDS on transfer of Virtual Digital Assets (VDA) including cryptocurrency, NFTs, and other virtual assets is 1%. Thresholds: ₹10,000 per year for general taxpayers; ₹50,000 per year for 'specified persons' (Government entities, certain specified organisations). For exchange-based transactions (Binance, CoinDCX, WazirX etc.), the exchange deducts TDS. For peer-to-peer transactions without an exchange, the buyer is responsible for deducting TDS. If the buyer is an individual, they must deposit TDS using Form 26QF.

No — there is a built-in escape route under Section 398 of the Income Tax Act 2025. If the EMPLOYEE (recipient/payee) has declared the income in their ITR AND paid the full tax due, the employer (deductor) will NOT be treated as 'assessee in default'. To use this escape, the employer must obtain a certificate from a Chartered Accountant confirming that the employee has paid tax on the relevant income and submit it to the tax authorities. However, interest for the delay (1% per month on the TDS amount) under Section 399 may still be levied on the employer for the period of non-deduction.

Under Section 394 of the Income Tax Act 2025, TCS on Liberalised Remittance Scheme (LRS) remittances is 20% on aggregate remittances exceeding ₹10,00,000 per person per year (threshold raised from ₹7 lakh). The TCS is collected by your authorised dealer (bank) at the time of remittance. Exceptions: overseas education (self-funded) — 5% TCS on amounts above ₹7 lakh; education funded by loan from Indian financial institution — 0.5% TCS; medical treatment abroad — 5% TCS. This TCS can be claimed as credit against your income tax liability in your ITR.

The quarterly TDS return due dates for Tax Year 2026-27 are: Q1 (April–June 2026) → 31 July 2026; Q2 (July–September 2026) → 31 October 2026; Q3 (October–December 2026) → 31 January 2027; Q4 (January–March 2027) → 31 May 2027. TDS returns are filed using Form 138 (salary TDS — replaces old Form 24Q), Form 140 (non-salary resident TDS — replaces Form 26Q), and Form 144 (non-resident TDS — replaces Form 27Q). Penalty for late filing: ₹200 per day (Section 476) + possible penalty equal to TDS amount.

Under the Income Tax Act 1961, there were approximately 37 separate TDS sections — Section 192 (salary), 194A (interest), 194B (lottery), 194BB (horse race), 194C (contractor), 194D (insurance commission), 194H (commission), 194I (rent), 194IA (property), 194IB (rent by individuals), 194J (professional fees), 194K (mutual funds), 194N (cash withdrawal), 194O (e-commerce), 194P (senior citizens), 194Q (purchase), 194R (perquisites), 194S (VDA), 194T (partner salary), 195 (non-residents), and more. Under the Income Tax Act 2025, all these are consolidated into just three parent sections: Section 392 (salary TDS), Section 393 (all non-salary TDS in 6 tables), and Section 394 (TCS). The rates are largely unchanged — only the structure is simplified.