Introduction
Keeping up with new TDS rates in India is crucial for anyone handling payments like salaries, rents, or fees to avoid mistakes and fines. TDS, or Tax Deducted at Source, sees updates each year, and Budget 2025 brought changes effective from April 1, 2025, for FY 2025-26. These include higher limits, a new section for partners, and slab tweaks to help small payers. In this guide, we’ll explain the new TDS rates in India simply, with a chart, key changes, and tips. Whether you’re a business or individual, understanding new TDS rates in India ensures smooth compliance. As of July 2025, no major mid-year shifts, but always check official sources.
Major Updates from Budget 2025
Budget 2025 focused on making TDS easier by raising thresholds and adding targeted rules. Here are the highlights for new TDS rates in India:
- Thresholds increased: For example, professional fees (194J) from Rs. 30,000 to Rs. 50,000 yearly per category, and rent (194-I) to Rs. 50,000 monthly from Rs. 240,000 yearly.
- New Section 194T: 10% TDS on partner payments like salary or interest over Rs. 20,000 yearly for firms.
- Slab changes for salary (192): New regime now nil up to Rs. 4 lakh, then 5% to 30% in steps, saving up to Rs. 114,000 for many.
- Other tweaks: TCS for timber down to 2% from 2.5%, and removed higher rates for non-ITR filers.
- Without PAN: Rates generally 20% or more.
These updates in new TDS rates in India support businesses while keeping revenue steady.
Full Chart of New TDS Rates for 2025-26
Below is a table with major sections, thresholds, and new TDS rates in India. Deduct at payment or credit; deposit by 7th next month (30 April for March). Rates for residents; non-residents vary.
| Section | Payment Type | Threshold (Rs.) | New Rate (%) |
|---|---|---|---|
| 192 | Salary | Slab-based (no fixed) | New slabs (0-30) |
| 193 | Securities interest | 10,000 yearly | 10 |
| 194 | Dividends | 10,000 yearly | 10 |
| 194A | Other interest | 10,000 (non-banks); 50,000 (banks); 100,000 (seniors) | 10 (20 no PAN) |
| 194B | Lottery winnings | 10,000 per win | 30 |
| 194BA | Online winnings | No threshold | 30 |
| 194BB | Horse race winnings | 10,000 per win | 30 |
| 194C | Contractors | 30,000 single; 100,000 yearly | 1 (individuals); 2 (others) |
| 194D | Insurance commission | 20,000 yearly | 2 (individuals); 10 (companies) |
| 194G | Lottery commission | 20,000 yearly | 2 |
| 194H | Brokerage | 20,000 yearly | 2 |
| 194-I | Rent (building) | 50,000 monthly | 10 |
| 194-I | Rent (machinery) | 50,000 monthly | 2 |
| 194IA | Property transfer | 5,000,000 | 1 |
| 194IB | Individual rent | 50,000 monthly | 2 |
| 194J | Professional fees | 50,000 yearly per type | 10 (professional); 2 (technical) |
| 194K | Mutual funds | 10,000 yearly | 10 |
| 194LA | Compensation | 500,000 yearly | 10 |
| 194M | Individual contracts | 5,000,000 | 2 |
| 194N | Cash withdrawals | 10,000,000 (filers); 2,000,000 (non-filers) | 2 (up to 10M); 5 (above) |
| 194O | E-commerce | 500,000 | 0.1 |
| 194Q | Goods purchase | Over 5,000,000 | 0.1 |
| 194R | Business perks | 20,000 yearly | 10 |
| 194S | Digital assets | 10,000 (others); 50,000 (some) | 1 |
| 194T | Partner payments | 20,000 yearly | 10 |
| 195 | Non-resident payments | No threshold | Varies (e.g., 20 royalties) |
Non-residents can use treaties for lower rates. No TDS below thresholds or for exempt groups.
Focus on Important Sections
Section 192: Salary
Deduct based on new regime slabs unless old chosen. Submit proofs via Form 12BB to cut TDS. The update saves money for mid-income earners.
Section 194J and 194-I: Fees and Rent
Higher limits help small deals. For 194J, types like professional and technical are separate. Rent’s monthly check eases variable payments.
Section 194T: New for Partners
Deducts 10% over Rs. 20,000 on firm payments to partners, ensuring source taxation.
How to Follow New TDS Rates
Track per payee, check PAN to avoid 20% rate, file Form 26Q quarterly. If low income, use Form 15G/15H. TaxQue automates for accuracy.
Penalties and Refunds
Misses mean 1-1.5% monthly interest and fines. Claim excess via ITR and Form 26AS.
Frequently Asked Questions (FAQs)
What are the main new TDS rates in India for 2025?
New TDS rates in India include 10% for dividends (194), with higher thresholds like 50,000 for fees (194J). Salary follows updated slabs.
What is new Section 194T in TDS rates?
Section 194T in new TDS rates in India deducts 10% on partner payments over Rs. 20,000 yearly, for firms.
How did thresholds change in new TDS rates in India?
Thresholds rose, like rent to Rs. 50,000 monthly and interest for seniors to Rs. 100,000 in new TDS rates in India.
What if no PAN under new TDS rates in India?
Rates go to 20% or higher. Provide PAN to use standard new TDS rates in India.
How to comply with new TDS rates in India?
Deposit timely, file returns, use tools. TaxQue helps with new TDS rates in India calculations and filings.
Conclusion
The new TDS rates in India for 2025 make taxes fairer with higher limits and simpler rules. By understanding changes and the chart, you can handle deductions without worry. Focus on tracking and timely actions for compliance. TaxQue offers support for all TDS needs, from calculations to expert advice. Stay informed, use the tips, and simplify your taxes this year.
