Budget 2025 Direct and Indirect Tax Changes
February 2, 2025
Tax Deducted at Source (TDS) plays a crucial role in tax compliance for businesses and individuals. It ensures the timely collection of taxes by deducting a portion of payments at the source itself, reducing tax evasion and improving transparency. Understanding the latest TDS rates for FY 2025-26 (AY 2026-27) is essential for accurate tax planning and smooth financial operations.
This guide provides a detailed overview of the latest TDS rates, covering salary payments, interest income, contractor payments, rent, professional fees, and other key transactions. It also incorporates all applicable amendments from the Union Budget 2025, ensuring you stay updated with the latest tax regulations.
Updated TDS Rate Chart for FY 2025-26
Below is a concise breakdown of TDS rates, applicable thresholds, and tax deduction percentages for various transactions:
| Section | Nature of Transaction Limit | Limit | TDS Rate |
| 192 | Salary | Income Tax Slab | Slab rates (Based on old or new tax regimes) |
| 192A | EPF- Premature Withdrawal | 50000 | 10% |
| 193 | Interest on Securities | 10000 | 10% |
| 194 | Dividend (other than listed companies) | 10000 | 10% |
| 194A | Interest (other than Securities) by bank/ post office | (i) Rs. 1,00,000/- for senior citizen; (ii) Rs. 50,000/- for others (when payer is bank, cooperative society and post office); (iii) Rs. 10,000/- in other cases | 10% |
| 194A | Interest (other than Securities) by bank/ post office | 50000/100000 | 10% |
| 194A | Interest (other than Securities) by other | 10000 | 10% |
| 194B | Winning from Lotteries, Puzzle, Game | 10000 (Single Transaction) | 30% |
| 194BA | Winnings from online games | NIL | 30% |
| 194BB | Winning from Horse Race | 10000 (Single Transaction) | 30% |
| 194C | Payment to Contractor/Sub-Contractor Individuals/HUF Other | 30000/100000 | 1% 2% |
| 194D | Payment of Insurance Commission | 20000 | 2% in case of persons other than company/ 10% in case of Domestic company |
| 194DA | Payment in Respect of LIC | 100000 | 2% |
| 194E | Payment to NR Sportsmen/Sport association | NA | 20% |
| 194EE | Payment of NSS Deposits | 2500 | 10% |
| 194F | Payment of repurchase of unit by UTI or any mutual fund | NIL | 20% |
| 194G | Commission on Sale of Lottery Tickets | 20000 | 2% |
| 194H | Commission or Brokerage | 20000 | 2% |
| 194I | Rent of L&B or Furniture | 50000 per month or part of the month | 10% |
| Rent of Plant & Machinery | 50000 Per Month or part of the month | 2% | |
| 194IA | Transfer of Immovable Property (other than Agricultural land) | 50 lakh | 1% |
| 194IB | Rent (Individuals who are not liable to Tax Audit) | 50000 (Monthly) | 2% |
| 194IC | Payment of monetary consideration under JDA | NA | 10% |
| 194 J | a. Fee for Technical service | 50000 | 2% |
| b. Amounts paid as royalty for sale/ distribution/exhibition of cinematographic films | 50000 | 2% | |
| c. Any other Fees paid for professional services | 50000 | 10% | |
| 194K | Income in respect of units of a mutual fund or specified company or undertaking payable to resident person | 10000 | 10% |
| 194LA | Payment of compensation on acquisition of certain Immovable Property | 5000000 | 10% |
| 194LB | Interest from Infrastructure Bond to NRI | NA | 5% |
| 194LBA(1) | Certain income distributed by a business trust among its unit holder | NA | 10% |
| 194LBB | Investment fund paying an income to a unit holder [other than income which is exempt under Section 10(23FBB)] | NA | 10% |
| 194LBC | Income in respect of investment made in a securitisation trust | NA | 25% if the payee is an individual or a Hindu Undivided Family (HUF).30% if the payee is any other person, such as a company, firm, or association of persons (AOP). |
| 194LD | Interest on certain Bonds and Govt. Securities | NA | 5% |
| 194M | Payment of commission (not being insurance commission), brokerage, contractual fee, or professional fee to a resident person by an Individual or a HUF who are not liable to deduct TDS under section 1940, 194H, or 194J. | 50 lakh | 2% |
| 194N | Cash Withdrawal | 1 Cr/3 Cr/20 lakh | 2%/5% |
| 194O | Payment or credit of amount by the e-commerce operator to e-commerce participant | 5 Lakh | 0.1% |
| 194P | TDS on Senior Citizen above 75 Years (Non-filers of ITR) | NA | Slab Rates |
| 194Q | Purchase of Goods | 50 Lakh | 0.10% |
| 194R | Deduction of tax in case any benefit or perquisite is provided and aggregate value of such benefit/perquisite exceeds Rs. 20,000 | 20000 | 10% |
| 1945 | TDS on Payment for Virtual Digital Assets | SPP-50000 OP-10000 | 1% |
| 206AA | TDS in case of Non-Availability of PAN | NA | Higher of As per act Twice the rate or rate in force20% |
| 206AB | TDS on Non-filers of ITR | NA | Higher of 5%Twice the rate in act Twice the rate or rate in force |
Conclusion:
Whether you’re a business owner, salaried individual, or tax consultant, staying informed about TDS thresholds, exemptions, and compliance requirements will help you avoid penalties and streamline tax filings.
You may find our other blogs below:
Who should file an Income Tax Return (ITR)?: Click here
Old Tax Regime vs New Tax Regime: Click here
Budget 2025 Direct and Indirect Changes: Click here
Source Info: https://incometax.gov.in/
