IT Tools · FY 2025-26 (AY 2026-27)

TDS Calculator

Pick the TDS section, enter the payment, and instantly see whether tax must be deducted at source, at what rate, and how much reaches the payee, using the thresholds updated by Budget 2025.

Payment details

Thresholds and rates as applicable for FY 2025-26 (AY 2026-27).

TDS section Nature of payment

Payment amount Gross, before TDS

₹

₹0₹12.5L₹25L₹37.5L₹50L

Recipient has PAN? No PAN → 20% u/s 206AA

For guidance only, consult Taxopd before acting. TDS rules carry many payer-specific conditions (turnover limits for individual payers, exemption certificates, aggregation across bills) that a calculator cannot fully capture.

Ready Reckoner

TDS rates & thresholds, FY 2025-26

Budget 2025 raised several thresholds from 1 April 2025. The row matching your selection above is highlighted.

Section	Nature of payment	Threshold (FY 2025-26)	Rate with PAN	Rate without PAN
194	Dividend on shares	₹10,000 per FY	10%	20%
194A	Interest, bank / co-op / post office	₹50,000 per FY	10%	20%
194A	Interest, senior citizen depositor	₹1,00,000 per FY	10%	20%
194B	Winnings, lottery, games, puzzles	₹10,000 per single win	30%	30%
194C	Contractor / sub-contractor	₹30,000 single bill / ₹1,00,000 per FY	1% (Indiv/HUF) · 2% others	20%
194H	Commission or brokerage	₹20,000 per FY	2%	20%
194-I(b)	Rent, land or building	₹50,000 per month	10%	20%
194-I(a)	Rent, plant & machinery	₹50,000 per month	2%	20%
194J	Professional fees	₹50,000 per FY	10%	20%
194J	Technical services / call centre	₹50,000 per FY	2%	20%

Under Section 206AA, if the recipient does not furnish PAN, TDS is deducted at the higher of the section rate or 20%. Section 194B is already 30%, so it stays 30% even without PAN.

Understand The Numbers

How TDS works

Tax Deducted at Source is advance tax collected by the person paying you, not an extra tax on top.

The mechanics

When a payment crosses the threshold set for its section, the payer must cut tax before releasing the money, deposit it with the government (generally by the 7th of the next month), and report it in a quarterly TDS return. That deposit then appears against your PAN in Form 26AS and AIS, and you claim it as a credit when you file your income tax return, so if your final tax bill is lower than the TDS already deducted, the difference comes back as a refund.

The formula is simple:

TDS = Payment amount × Section rate  (only once the threshold is crossed)

One point that surprises people: once the threshold is crossed, TDS applies to the entire amount, not just the part above the threshold. Interest of ₹49,000 from a bank attracts no TDS; interest of ₹51,000 attracts TDS on the full ₹51,000.

Worked example

Scenario: A company pays a freelance designer ₹1,20,000 in professional fees during FY 2025-26. The designer has quoted her PAN.

Section194J, Professional fees

Threshold₹50,000, crossed

Rate10%

TDS deducted₹12,000

Paid to designer₹1,08,000

The ₹12,000 is not lost, it shows up in her Form 26AS and reduces the tax she owes at filing time.

Common Questions

TDS FAQs

No. TDS is a collection mechanism, not a separate tax. The payer deducts a slice of your payment and deposits it with the government on your behalf, against your PAN. When you file your return, every rupee of TDS is set off against your final tax liability, and refunded if you were over-deducted. Think of it as tax paid in instalments through the year instead of one lump sum at filing.

Log in to the income tax e-filing portal and open Form 26AS (via TRACES) and your Annual Information Statement (AIS). Both list every TDS entry reported against your PAN, deductor name, section, amount paid and tax deposited. Reconcile these before filing your return; if a deduction is missing, ask the deductor to correct their TDS return, otherwise the credit may be denied.

Often, yes. For bank interest, submit Form 15G (or 15H if you are a senior citizen) declaring that your total income is below the taxable limit. For other payments, rent, professional fees, contracts, you can apply to the Assessing Officer in Form 13 for a certificate under Section 197 allowing deduction at a lower or nil rate, which you then hand to the payer. Taxopd regularly assists with 197 applications.

Section 206AA forces the payer to deduct at the higher of the normal section rate or 20%. So a 1% contractor payment becomes a 20% deduction, a painful cash-flow hit. Worse, without a PAN the credit cannot be mapped to the recipient, making it hard to claim back. Always collect and verify the payee's PAN before releasing payment.