ReckonBoxHow the TDS calculator works
TDS, or tax deducted at source, is tax the payer holds back before paying a vendor and deposits with the government on their behalf, and it only bites once the payment crosses the threshold set for its section. This calculator answers the question in that order: first whether any TDS is due at all, then the rate and why that rate, then the amount and what actually reaches the payee.
Work the default. A ₹55,000 professional fee under section 194J crosses the ₹50,000 yearly limit, so ₹5,500 comes off at 10% and the vendor receives ₹49,500. Drop the fee to ₹45,000 and the answer changes completely: no TDS at all, because nothing crossed the limit. That second case is the one most calculators cannot tell you, since they return a number whatever you type.
The threshold decides first
Every TDS section has its own limit, and below it no tax is deducted at all. The limits aren't intuitive and they aren't uniform: some run on the yearly total to one party, one runs per month, and section 194C runs on two limits at once.
| Payment | Threshold | Rate |
|---|---|---|
| 194J professional fees | ₹50,000 a year | 10% |
| 194J technical services | ₹50,000 a year | 2% |
| 194C contractor | ₹30,000 a payment or ₹1,00,000 a year | 1% individual, 2% company |
| 194H commission | ₹20,000 a year | 2% |
| 194I rent of land or building | ₹50,000 a month | 10% |
| 194A bank interest | ₹50,000 a year, ₹1,00,000 for a senior citizen | 10% |
Section 194C is the trap. It fires on a single payment above ₹30,000 or a yearly total above ₹1,00,000, whichever comes first, so four payments of ₹28,000 each slip under the single-payment limit and still cross the annual one. Enter what you have already paid the party this year and the calculator tells you which of the two limits tripped.
The rate, and why it is that rate
The rate depends on the section, and for a contractor it also depends on who you are paying: 1% to an individual or HUF, 2% to a company or firm. The 194J split catches people too, since professional fees are 10% while technical services are only 2%, on the same ₹50,000 limit. The limit applies to each category separately, so a ₹45,000 royalty and a ₹20,000 technical payment attract nothing, even though they add up to ₹65,000.
Without a PAN the rate jumps to the higher of the normal rate or 20%. One exception is worth knowing and is missing from every ranked calculator we checked: TRACES, the CBDT's own portal, sets the no-PAN floor at 5% rather than 20% for sections 194-O and 194Q. On a large goods purchase that difference is real money.
What changed, and what stopped mattering
Section 206AB, which doubled TDS for anyone who had not filed a return, was omitted on 1 April 2025 by the Finance Act 2025, so a vendor's filing status no longer changes the rate. Only the PAN still matters. Several pages ranking today still list 206AB as live, and one still calls its removal "proposed" fifteen months after it took effect, so this is worth stating plainly.
The bigger shift is the statute itself. From 1 April 2026 the Income Tax Act, 2025 renumbers TDS: salary moves from section 192 to 392, and sections 193 through 196D collapse into a single section 393, with the no-PAN rule moving from 206AA to 397(2). Nobody types "393" yet, so the calculator takes the number you know and shows you the new one alongside it.
Budget 2025 also lifted most limits on 1 April 2025: 194J went from ₹30,000 to ₹50,000, 194H from ₹15,000 to ₹20,000, bank interest from ₹40,000 to ₹50,000 (and ₹1,00,000 for senior citizens), and rent from ₹2,40,000 a year to ₹50,000 a month. Charts still showing the old figures will under-deduct.
The section numbers changed, the rates did not
Every section number on this page belongs to the Income-tax Act 1961, and since 1 April 2026 the governing provision has been section 393 of the Income-tax Act 2025. More than fifty standalone TDS sections, the whole 194-series among them, were folded into sections 392 to 401, with salary deduction at 392 and everything else at 393.
What that means in practice:
- The payment types are now rows in a table under section 393(1), each with its own serial number, where each used to be a section in its own right. The table sets out the nature of the payment, who must deduct, and the rate and threshold together.
- Rates and thresholds carried over, which is why every figure in the chart above still holds. The change was structural, not substantive.
- Forms 15G and 15H became Form 121, a single declaration under section 393(6) read with Rule 211 of the Income-tax Rules 2026, covering both the under-60 and 60-plus cases.
- The old numbers remain how almost everyone refers to these deductions, including banks and accounting software, so this page keeps them.
One caution on the published mapping tables. Several now circulating assign specific serial numbers to each old section, and they disagree with each other: the same professional-fee deduction is given as 393(1) serial 6(iii) by one and as 393(1)(b) by another, and one chart puts commission at 5% where the statutory table says 2%. The figures in our chart come from the rates and thresholds themselves, which are verifiable against the statutory table. A serial number the sources cannot agree on is not worth printing.
Salary is the exception
TDS on salary under section 192, now 392, is not a flat percentage: the employer estimates your tax for the whole year at slab rates and spreads it across the months. So an annual liability of ₹1,17,000 becomes roughly ₹9,750 a month, and no single rate describes it. That's why salary isn't in the picker here. For the annual figure use the income tax calculator, and for what actually lands in your account each month use the take-home salary calculator.
What this does not cover
This calculator handles the common resident sections: the threshold test, the rate, the PAN rule and the arithmetic. It doesn't cover payments to non-residents under section 195, where surcharge and cess ride on top and treaty rates can apply, and it does not handle lower or nil deduction certificates under section 197. It also does not decide which section your payment falls under, which is a question of the contract and the nature of the work, and is where most TDS disputes actually sit. GST TDS under section 51 of the CGST Act is a different levy entirely, despite the shared name; our GST calculator covers GST itself. Rates move with each Budget, so treat this as arithmetic rather than tax advice, and have a chartered accountant confirm anything that matters.
Frequently asked questions
What is TDS and how is it calculated? TDS, or tax deducted at source, is tax the payer withholds before paying a vendor and deposits with the government. It applies only once the payment crosses the threshold for its section, and then the rate runs on the payment: a ₹55,000 professional fee under 194J crosses the ₹50,000 limit, so ₹5,500 is deducted at 10% and ₹49,500 is paid out.
What are the TDS threshold limits? Each section has its own limit: ₹50,000 a year for 194J professional or technical fees, ₹20,000 for 194H commission, ₹50,000 a month for 194I rent, ₹50,000 a year for bank interest under 194A (₹1,00,000 for a senior citizen), and ₹30,000 a single payment or ₹1,00,000 a year for a 194C contractor. Below the limit no TDS is due at all, which the calculator states in words.
Are the 194 section numbers still correct? They are the Income-tax Act 1961 numbers, and since 1 April 2026 the governing provision has been section 393 of the Income-tax Act 2025, which folded the whole 194-series into one section with a table of payment types. The rates and thresholds carried over unchanged, so every figure here still applies, and the old numbers remain how banks, accountants and software refer to these deductions. Forms 15G and 15H became Form 121 under section 393(6).
How does the 194C contractor threshold work? Section 194C fires on either of two limits, whichever is crossed first: a single payment above ₹30,000, or a yearly total above ₹1,00,000 to the same party. So four payments of ₹28,000 escape the single-payment limit but cross the yearly one, and the calculator tells you which of the two tripped.
What is the TDS rate if the payee has no PAN? Without a PAN, tax is deducted at the higher of the specified rate, the rate in force, or 20%, under the old section 206AA and now section 397(2). TRACES sets a lower floor of 5% for sections 194-O and 194Q, so a no-PAN e-commerce or goods-purchase deduction is 5%, not 20%.
Is TDS higher if the payee has not filed an income tax return? No, not any more. Section 206AB, which doubled the rate for non-filers, was omitted from 1 April 2025 by the Finance Act 2025, so you no longer check a vendor filing status to set the rate. The higher rate for a missing or invalid PAN still applies.
Which section covers TDS under the new Income Tax Act, 2025? From 1 April 2026 the Income Tax Act, 2025 consolidates TDS: salary moves from section 192 to 392, and sections 193 to 196D collapse into section 393, with the no-PAN rule moving from 206AA to 397(2). The rates and thresholds carry over, so a 194J professional fee is now section 393 and still 10% above ₹50,000.
How is TDS on salary calculated? Salary TDS is not a flat percentage. The employer estimates your tax for the year at the slab rates and spreads it across the months, so a ₹1,17,000 annual liability becomes about ₹9,750 a month. Because it follows the slabs, salary is not in this calculator; work it out with the income tax calculator instead.
What is the difference between 194J professional and technical services? Professional fees under 194J are deducted at 10%, while technical services are deducted at 2%, and both share the ₹50,000 yearly limit. The limit applies to each category on its own, so a ₹45,000 royalty and a ₹20,000 technical payment attract no TDS, even though together they exceed ₹50,000.
Sources
- Income Tax Department, Form 121, which replaced Forms 15G and 15H
- The Income Tax Act 2025, section 393(1) and its table of payments
- TRACES (CBDT), TDS rates and the no-PAN rule
- ClearTax, TDS rate chart and section 194J
- ClearTax, TDS and TCS changes from April 2025
- TaxGuru, removal of the higher TDS rate for non-filers