Practical Approach to TDS & TCS

Edition: 4th edn., 2026

ISBN: 978-93-47779-99-2

Pages: 592

Author: CA. R.S. Kalra

Two Golden Rules of TDS A Comparative Study: Income Tax Act 1961 v/s Income Tax Act 2025 TDS Rates for Financial Year 2025-26 (Assessment Year 2026-27) (Where Recipient is Resident) TDS Rates for Financial Year 2025-26 (Assessment Year 2026-27) (Where Recipient is Non-Resident) TCS Rates for Financial Year 2025-26 (Assessment Year 2026-27) (Rates of Tax Collected at Source) Payment of Salary — Section 392 Payment to Residents (Other than Salary) — Section 393(1) Payment to Non-Residents —Section 393(2) Payment to any person — Section 393(3) TCS Rates — Section 394 (As Amended by Finance Act, 2026) Practical Checklist for Deducting TDS on Business PaymentsIntroduction  Part ATax to be Deducted on Salary and Accumulated Balance due to an Employee Part BTax to be Deducted at Source for Payments to Residents Chapter B-1 TDS on Insurance Commission [(Sec 393(1) Table SI. 1(i) ITA 2025) (Sec 194D ITA 1961)] Chapter B-2 Commission or Brokerage [(Sec 393(1) Table SI.1(ii) ITA 2025) (Sec 194H ITA 1961)] Chapter B-3 TDS on Payment of Rent by Certain Individual/HUF [(Sec 393(1) Table S1.2(i) ITA 2025) (Sec 194IB ITA 1961)] Chapter B-4 Rent [(Sec 393(1) Table Sl.2(ii) ITA 2025) (Sec 194I ITA 1961)] Chapter B-5 TDS on Payment on Transfer of certain Immovable Property other than Agricultural Land [(Sec 393(1) Table SI.3(i) ITA 2025) (Sec 194-IA ITA 1961)] Chapter B-6 TDS on Payment made under Specified Agreement [(Sec 393(1) Table SI.3(ii) ITA 2025) (Sec 194IC ITA 1961)] Chapter B-7 TDS on Payment of Compensation on Acquisition of Certain Immovable Property [(Sec 393(1) Table SI.3(iii) ITA 2025) (Sec 194LA ITA 1961)] Chapter B-8 Tax Deduction on Income from Mutual Fund Units [(Sec 393(1) Table SI.4(i) ITA 2025) (Sec 194K ITA 1961)] Chapter B-9 TDS on Certain Income from Units of a Business Trust [(Sec 393(1) Table SI.4(ii) ITA 2025) (Sec 194LBA ITA 1961)] Chapter B-10 TDS on Income of Units of Investment Fund [(Sec 393(1) Table SI.4(iii) ITA 2025) (Sec 194LBB ITA 1961)] Chapter B-11 TDS on Income from Investment in Securitization Fund [(Sec 393(1) Table SI.4 (iv) ITA 2025) (Sec 194LBC ITA 1961)] Chapter B-12 Interest on Securities [(Sec 393(1) Table SI.5(i) ITA 2025) (Sec 193 ITA 1961)] Chapter B-13 Interest other than Interest on Securities [(Sec 393(1) Table SI.5(ii)(iii) ITA 2025) (Sec 194A ITA 1961)] Chapter B-14 Payments to Contractors and Sub-Contractors [(Sec 393(1) Table SI.6(i) ITA 2025) (Sec 194C ITA 1961)] Chapter B-15 TDS on Payments of Certain Sums by Individual and HUF [(Sec 393(1) Table SI.6(ii) ITA 2025) (Sec 194M 1961)] Chapter B-16 Fees for Professional or Technical Services [(Sec 393(1) Table SI.6 ITA 2025) (Sec 194J ITA 1961)] Chapter B-17 Dividends [(Sec 393(1) Table Sl.7 ITA 2025) (Sec 194 ITA 1961)] Chapter B-18 TDS on Payment in respect of Life Insurance Policy [(Sec 393(1) Table SI.8(i) ITA 2025) (Sec 194DA ITA 1961)] Chapter B-19 Deduction of Tax at Source on Purchase of Goods [(Sec. 393(1), Table Sl. No. 8(ii) ITA 2025) (Sec 194Q ITA 1961)] Chapter B-20 Deduction of Tax by a Specified Bank in Case of Specified Senior Citizen [(Sec 393(1) Table Sl.8(iii) ITA 2025) (Sec 194P ITA 1961)] Chapter B-21 TDS on Perquisites in respect of Business [(Sec 393(1) Table Sl.8(iv) ITA 2025) (Sec 194R ITA 1961)] Chapter B-22 TDS on Payments made to e-Commerce Participants [(Sec 393(1) Table Sl.8(v) ITA 2025) (Sec 194O ITA 1961)] Chapter B-23 Payment on Transfer of Virtual Digital Asset [(Sec 393(1) Table 8(vi) ITA 2025) (Sec 194S ITA 1961)] Part CTax to be deducted at Source for Payments to Non-Residents Chapter C-1 Payment to Non-Resident Sports Men or Sports Association [(Sec 393(2) ITA 2025 Table S. No 1) (Sec 194E ITA 1961)] Chapter C-2 Income by way of Interest from an Indian Company or Business Trust [(Sec 393(2) ITA 2025 Table S. No 2-4) (Sec 194LC ITA 1961)] Chapter C-3 TDS on Interest from Infrastructure Debt Fund [(Sec 393(2) ITA 2025 Table S. No 5) (Sec 194LB ITA 1961)] Chapter C-4 TDS on certain Income from Units of a Business Trust [(Sec 393(2) ITA 2025 Table S. No 6-7) (Sec 194LBA ITA 1961)] Chapter C-5 TDS on Income of Units of Investment Fund [(Sec 393(2) ITA 2025 Table S. No. 8) (Sec 194LBB ITA 1961)] Chapter C-6 TDS on Income from Investment in Securitization Fund [(Sec 393(2) ITA 2025 Table S. No. 9) (Sec 194LBC ITA 1961)] Chapter C-7 Income in respect of Units of Non-Residents [(Sec 393(2) Table S. No 10 ITA 2025) (Sec 196A ITA 1961)] Chapter C-8 TDS on Income from Units [(Sec 393(2) Table S. No. 11-12 ITA 2025) (Sec 196B ITA 1961)] Chapter C-9 TDS on Income from Foreign Currency Bonds or GDR [(Sec 393(2) ITA 2025 Table S. No. 13-14) (Sec 196C ITA 1961)] Chapter C-10 TDS on Income of FII from Securities [(Sec 393(2) ITA 2025 Table S. No. 15-16) (Sec 196D ITA 1961)] Chapter C-11 TDS on other sums payable to Non-Resident [(Sec 393(2) ITA 2025 Table S. No. 17) (Sec 195 ITA 1961)] Part DTax to be deducted at source for Payments to any Person Chapter D-1 Winnings from Lotteries or Crossword Puzzles [(Sec 393(1) Table SI.1 ITA 2025) (Sec 194B ITA 1961)] Chapter D-2 Winnings from Online Games [(Sec 393(1) Table SI.2 ITA 2025) (Sec 194BA ITA 1961)] Chapter D-3 Winnings from Horse Races [(Sec 393(1) Table Sl.3 ITA 2025) (Sec 194BB ITA 1961)] Chapter D-4 Commission on Sale of Lottery Tickets [(Sec 393(1) Table Sl.4 ITA 2025) (Sec 194G ITA 1961)] Chapter D-5 Cash Withdrawal [(Sec 393(1) Table Sl.5 ITA 2025) (Sec 194N ITA 1961)] Chapter D-6 Payments in respect of NSS [(Sec. 393(3) (Table Sl. 6) ITA 2025) (Sec 194EE ITA 1961)] Chapter D-7 Payments to Partners of Firms [(Sec 393(1) Table Sl.7 ITA 2025) (Sec 194T ITA 1961)] Part E Collection of Tax at Source Part FProcedural Mechanism for Deposit and Reporting of TDS and TCS Chapter F-1 Compliance and Reporting of TDS and TCS [Section 397 (erstwhile sections 203A, 206CA of ITA 1961)] Chapter F-2 Processing of TDS and TCS Returns Chapter F-3 Consequences for Failure to Deduct/Collect or Deposit TDS or T