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A TDS calculator India solves a compliance problem that millions of deductors and deductees face every month — how much tax must be withheld at source on a given payment? Enter the payment amount, select the applicable section, and the calculator returns the exact TDS to be deducted and the net payable. For FY 2026-27, the Income Tax Act, 2025 has restructured TDS provisions under new section codes, but the core rates and thresholds remain largely intact. This guide walks through section-wise rates, thresholds, calculation methods, and the compliance deadlines that every business and taxpayer must track.
TDS, or Tax Deducted at Source, is a mechanism where tax is collected at the point where income is earned rather than at the end of the financial year. The person making the payment — the deductor — withholds a percentage of the amount and deposits it with the government. The recipient — the deductee — receives the net amount and claims credit for the tax already paid when filing their income tax return.
A TDS calculator automates this withholding computation. You input the gross payment, choose the relevant section, and the tool applies the correct rate and checks whether the payment exceeds the prescribed threshold. If the payment is below the threshold, no TDS is deducted. If it crosses the limit, the calculator returns the deduction amount and the net payable to the recipient.
The complexity lies in the thresholds and rates, which vary by payment type, recipient category, and even by whether the payment is a single transaction or an annual aggregate. A well-designed TDS calculator handles these distinctions without requiring the user to memorise every section.
For FY 2026-27, the Income Tax Act, 2025 has reorganised TDS provisions under new section codes — the old Section 194A becomes Section 393(1)[5(ii)] or 393(1)[5(iii)], for instance. However, the effective rates and threshold limits remain the same as those rationalised by the Finance Act 2025. The table below summarises the most commonly applied sections.
| Nature of Payment | Old Section | New Section Code (ITA 2025) | Threshold | TDS Rate |
|---|---|---|---|---|
| Salary | 192 | 392(1) | Basic exemption limit | Slab rates |
| Premature EPF withdrawal | 192A | 392(7) | ₹50,000 | 10% |
| Interest on securities | 193 | 393(1)[5(i)] | ₹10,000 | 10% |
| Dividend to individual shareholder | 194 | 393(1)[7] | No limit | 10% |
| Interest — senior citizens | 194A | 393(1)[5(ii)] | ₹1,00,000 | 10% |
| Interest — others (bank/PO) | 194A | 393(1)[5(ii)] | ₹50,000 | 10% |
| Interest — other than bank/PO | 194A | 393(1)[5(iii)] | ₹10,000 | 10% |
| Contractor — individual/HUF | 194C | 393(1)[6(i)] | ₹30,000 single / ₹1,00,000 aggregate | 1% |
| Contractor — others | 194C | 393(1)[6(i)] | ₹30,000 single / ₹1,00,000 aggregate | 2% |
| Insurance commission | 194D | 393(1)[1(i)] | ₹20,000 | 5% |
| Commission or brokerage | 194H | 393(1)[1(ii)] | ₹20,000 | 2% |
| Rent — plant, machinery | 194I(a) | 393(1)[2(ii)] | ₹50,000 per month | 2% |
| Rent — land, building, furniture | 194I(b) | 393(1)[2(ii)] | ₹50,000 per month | 10% |
| Professional fees | 194J | 393(1)[6(iii)] | ₹50,000 | 10% |
| Technical services / call centre | 194J | 393(1)[6(iii)] | ₹50,000 | 2% |
The threshold for rent under Section 194I is now assessed per month or part of a month, not on an annual aggregate basis. This change, effective from FY 2025-26, means a single month's rent exceeding ₹50,000 triggers TDS even if the annual rent is below ₹6,00,000.
Salary TDS is different from other sections. It is not a flat percentage but the average rate of income tax on your estimated annual taxable income. The employer projects your total salary for the year, subtracts exemptions and deductions, applies the slab rates, and computes the average rate. That rate is then applied to each month's salary.
The steps are:
For a quick estimate, a salary income tax calculator can project your liability, but the final TDS is determined by your employer using the actual salary structure.
Rent TDS applies when the monthly rent exceeds ₹50,000. The rate is 10% for land, building, and furniture, and 2% for plant and machinery. The threshold is assessed per month — if any single month's rent crosses ₹50,000, TDS applies for that month and continues for subsequent months.
Example: A company pays ₹60,000 per month as office rent to a landlord. Since the monthly rent exceeds ₹50,000, TDS at 10% applies. The monthly TDS is ₹6,000, and the net rent paid to the landlord is ₹54,000.
For rent below ₹50,000 per month, no TDS is deducted under Section 194I. However, if the tenant is an individual or HUF not liable to tax audit, and the annual rent exceeds ₹6,00,000, TDS under Section 194IB applies at 5% on the excess rent above ₹6,00,000. A TDS calculator can compute both scenarios accurately.
Payments to contractors and sub-contractors attract TDS under Section 194C. The rate is 1% for individual or HUF contractors and 2% for all other contractors. The threshold works on two levels: no TDS if a single payment does not exceed ₹30,000, and no TDS if the aggregate of all payments to the same contractor during the financial year does not exceed ₹1,00,000.
Once the aggregate crosses ₹1,00,000, TDS applies to the entire amount paid during the year, not just the amount above the threshold. This is a common point of confusion. If you paid ₹40,000 in April, ₹40,000 in June, and ₹40,000 in September, the aggregate is ₹1,20,000, which exceeds ₹1,00,000. TDS must be deducted on the full ₹1,20,000, at the applicable rate.
Professional fees, technical services, and director's remuneration attract TDS under Section 194J. The threshold for FY 2026-27 is ₹50,000 in a financial year, increased from the earlier ₹30,000. The rate is 10% for professional services and 2% for technical services and call centre operations.
If a company pays a consultant ₹60,000 during the year, the payment exceeds the ₹50,000 threshold, and TDS at 10% applies. The TDS is ₹6,000, and the net payment is ₹54,000. If the total payment were ₹45,000, no TDS would be deducted.
Interest income from bank deposits, post office schemes, and other sources attracts TDS under Section 194A. The threshold for FY 2026-27 is ₹50,000 for general citizens and ₹1,00,000 for senior citizens. The rate is 10%.
If a senior citizen earns ₹1,20,000 as interest from fixed deposits during the year, the threshold of ₹1,00,000 is exceeded, and TDS at 10% applies on the entire ₹1,20,000, resulting in a deduction of ₹12,000. For a non-senior citizen with the same interest income, the threshold is ₹50,000, and the TDS would be ₹12,000 on the full amount once the threshold is crossed.
Compliance deadlines are strict, and missing them attracts interest and penalties. For FY 2026-27, the due dates are:
| Quarter | Period | TDS Return Due Date |
|---|---|---|
| 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 |
For TDS payment, the due date is the 7th of the following month for all months except March. For March deductions, the due date is 30th April. Government deductors making TDS via book entry must deposit on the same day, except for March, when the deadline is 7th April.
Late filing of TDS returns attracts a fee of ₹200 per day under Section 234E, capped at the total TDS amount. Additionally, a penalty ranging from ₹10,000 to ₹1,00,000 may be levied under Section 271H. Interest under Section 201(1A) also applies — 1% per month for non-deduction and 1.5% per month for non-deposit.
If the deductee does not furnish their PAN to the deductor, TDS is deducted at the higher of the prescribed rate, twice the prescribed rate, or 20%. This is mandated by Section 206AA and applies across all TDS sections. For example, if the normal rate is 10%, the deduction becomes 20% without PAN. This higher rate is not discretionary — the deductor must apply it.
However, there are exceptions. If the deductee is a non-resident and the payment is governed by a DTAA with a lower rate, the higher rate under Section 206AA may not apply if the non-resident furnishes a Tax Residency Certificate and other required documents.
TDS on salary is calculated at the average rate of income tax on the estimated annual taxable income. The employer first subtracts standard deduction, exemptions like HRA and LTA, and deductions under Chapter VI-A (such as 80C and 80D). The resulting taxable income is then taxed as per the slab rates applicable to your chosen regime — old or new. The average rate is applied to the monthly salary to determine the TDS amount.
For FY 2026-27, TDS under Section 194I is applicable when the monthly rent exceeds ₹50,000. The threshold is now assessed per month or part of a month, not on an annual aggregate basis. If the rent for any single month crosses ₹50,000, TDS must be deducted at 10% for land, building, or furniture, and 2% for plant and machinery.
No TDS is required if a single payment to a contractor does not exceed ₹30,000. However, if the aggregate of all payments to the same contractor during the financial year exceeds ₹1,00,000, TDS becomes applicable. Once the aggregate limit is breached, TDS applies to the entire amount paid during the year, not just the excess. The rate is 1% for individual or HUF contractors and 2% for others.
Under Section 206AA, if you do not furnish your PAN to the deductor, TDS is deducted at the higher of the prescribed rate, twice the prescribed rate, or 20%. For example, if the normal rate is 10%, the deduction becomes 20% without PAN. This applies across all TDS sections, and the higher rate is mandatory, not discretionary.
For TDS deducted in March, the payment due date is 30th April of the following financial year. For all other months, the due date is the 7th of the succeeding month. Government deductors who make TDS via book entry must deposit on the same day of deduction, except for March, when the deadline is 7th April.
Late filing of TDS returns attracts a fee of ₹200 per day under Section 234E until the return is filed, capped at the total TDS amount. Additionally, a penalty ranging from ₹10,000 to ₹1,00,000 may be levied under Section 271H for failure to file the return within the prescribed time. Interest under Section 201(1A) also applies — 1% per month for non-deduction and 1.5% per month for non-deposit.
Yes. If the total TDS deducted exceeds your actual tax liability, you can claim a refund while filing your income tax return. The excess amount is adjusted against your tax payable, and the remaining balance is refunded to your bank account after processing. Form 26AS and AIS reflect all TDS credits, which you can verify before filing.
Yes. Payments to non-residents are governed by Section 195 of the Income Tax Act, with TDS rates varying by the nature of payment. However, if India has a Double Taxation Avoidance Agreement (DTAA) with the non-resident's country, a lower or nil rate may apply, provided the non-resident furnishes a Tax Residency Certificate and other required documents.
In sum, a TDS calculator India is not merely a convenience — it is a compliance tool that prevents under-deduction, avoids penalties, and ensures the correct tax reaches the government on time. Whether you are an employer deducting TDS on salary, a business paying contractors, or an individual receiving interest income, the rules for FY 2026-27 demand attention to section-wise rates, thresholds, and deadlines. Use the TDS calculator to compute your liability accurately, and treat the output as what it is: a precise, section-aware deduction figure that keeps you on the right side of the Income Tax Act.