Act Explained
TDS Provisions Under the Income Tax Act 2025
Every TDS and TCS provision that matters — salary TDS, bank interest, contractor payments, professional fees, NRI payments, and TCS. Plain English with rates and thresholds.
The Income Tax Act 2025 mandates that specific payments carry TDS — the payer deducts tax before paying you and deposits it with the government. As a taxpayer, you need to know which payments are covered, what the thresholds are, and how to claim credit for TDS in your ITR.
Key provisions
TDS on salary
How employers calculate and deduct tax from salary, and what exemptions are allowed.
TDS on bank interest
Interest paid by banks and post offices — threshold, PAN requirement, and Form 16A issuance.
TDS on other interest
Interest from insurance companies, NBFCs, and payers other than banks and post offices.
TDS on contractors
Payments to contractors and freelancers — per-payment and annual aggregate thresholds.
TDS on commission
Commission and brokerage — insurance renewal commission, franchise fees, and referral payments.
TDS on professional fees
Professional fees, technical services, and royalty — the two rates and who they apply to.
TDS on non-resident payments
Foreign payments and NRI income, plus the Form 15CA and 15CB filing requirement.
TCS — tax collected at source
Tax collected by the seller on sale of goods, foreign remittances, and overseas tour packages.
Sources
Sources: Income Tax Act 2025 · CBDT circulars (verified 2026-10-07). Last reviewed by FinWiz24 Research Desk.