TDS Codes & Rates Explained (2026): Simplified Table Under New Income Tax Act
Under the new Income Tax Act, TDS provisions have been reorganised and mapped into structured tables under Section 392 and Section 393, along with specific TDS codes for each nature of payment.
However, the official notifications and PDFs are often:
- difficult to navigate
- structured for legal reference
- not practical for day-to-day use
This article simplifies the entire structure into a single, usable reference, helping you quickly identify:
- correct TDS code
- applicable rate
- threshold limits
- mapping from old sections
Complete TDS Codes Table (With Rates, Thresholds & Sections)
| Old Section | TDS Code | Description | Rate | Threshold / Limit | New Section & Serial No. |
|---|---|---|---|---|---|
| 192 | 1004 | EPF withdrawal (taxable portion) | As per slab | ₹50,000 | 392(7) |
| 194H | 1005 | Insurance commission | 5% | ₹15,000 | 393(1) – Sl. No. 1(i) |
| 194H | 1006 | Commission (others) | 5% | ₹15,000 | 393(1) – Sl. No. 1(ii) |
| 194I | 1008 | Rent – machinery / equipment | 2% | ₹2,40,000 | 393(1) – Sl. No. 2(ii).D(a) |
| 194I | 1009 | Rent – land / building | 10% | ₹2,40,000 | 393(1) – Sl. No. 2(ii).D(b) |
| 194LA | 1012 | Compensation on acquisition of immovable property | 10% | ₹2,50,000 | 393(1) – Sl. No. 3(iii) |
| 193 | 1019 | Interest on securities | 10% | ₹5,000 | 393(1) – Sl. No. 5(i) |
| 194A | 1020 | Interest – senior citizens | 10% | ₹50,000 | 393(1) – Sl. No. 5(ii).D(a) |
| 194A | 1021 | Interest – others | 10% | ₹40,000 | 393(1) – Sl. No. 5(ii).D(b) |
| 194C | 1023 | Contract – Individual / HUF | 1% | ₹30,000 / ₹1,00,000 | 393(1) – Sl. No. 6(i).D(a) |
| 194C | 1024 | Contract – Others | 2% | ₹30,000 / ₹1,00,000 | 393(1) – Sl. No. 6(i).D(b) |
| 194J | 1026 | Technical services / royalty | 2% | ₹30,000 | 393(1) – Sl. No. 6(iii).D(a) |
| 194J | 1027 | Professional services | 10% | ₹30,000 | 393(1) – Sl. No. 6(iii).D(b) |
| 194J | 1028 | Director remuneration (Sitting Fee/Commission etc) | 10% | No limit | 393(1) – Sl. No. 6(iii).D(b) |
| 194 | 1029 | Dividend | 10% | ₹5,000 | 393(1) – Sl. No. 7 |
| 194DA | 1030 | Life insurance payout | 5% | ₹1,00,000 | 393(1) – Sl. No. 8(i) |
| 194Q | 1031 | Purchase of goods | 0.1% | ₹50,00,000 | 393(1) – Sl. No. 8(ii) |
| 194R | 1033 | Benefit / perquisite (non-cash) | 10% | ₹20,000 | 393(1) – Sl. No. 8(iv) |
| 194R | 1034 | Benefit / perquisite (cash / mixed) | 10% | ₹20,000 | 393(1) – Sl. No. 8(iv) |
| 194O | 1035 | E-commerce transactions | 1% | ₹5,00,000 | 393(1) – Sl. No. 8(v) |
Most Common TDS Codes Explained (Quick Reference)
TDS Code 1027 – Professional Services (10%)
Applicable on payments for professional services such as legal, consultancy, and advisory. Threshold generally applies beyond ₹30,000.
TDS Code 1023 – Contract Payments (Individual/HUF) (1%)
Used when payments are made to contractors who are individuals or HUFs, subject to specified limits.
TDS Code 1024 – Contract Payments (Others) (2%)
Applicable for contract payments to firms, companies, or other entities.
TDS Code 1009 – Rent (Land & Building) (10%)
Used for rent payments relating to property such as office premises, buildings, or land, subject to threshold limits.
TDS Code 1008 – Rent (Machinery & Equipment) (2%)
Applicable when rent is paid for machinery, plant, or equipment.
TDS Code 1031 – Purchase of Goods (0.1%)
Applicable on purchase transactions exceeding ₹50,00,000 in a financial year.
TDS Code 1026 – Technical Services / Royalty (2%)
Covers payments for technical services, royalty, and similar transactions.
TDS Code 1033 / 1034 – Benefits or Perquisites (10%)
Used when businesses provide benefits in cash or kind exceeding ₹20,000.
TDS Code 1020 – Interest (Senior Citizens) (10%)
Applicable on interest payments exceeding ₹50,000.
TDS Code 1021 – Interest (Others) (10%)
Applicable on interest payments exceeding ₹40,000.
TDS Code 1029 – Dividend Payments (10%)
Used when companies distribute dividends exceeding ₹5,000.
How to Use This Table of TDS Codes in Practice
To use this table effectively:
- Identify the nature of payment
- Refer to the old section (if known)
- locate the TDS codes
- check:
- rate
- threshold
- applicability
This ensures correct:
- deduction
- return filing
- challan classification
Important Points to Keep in Mind
- higher TDS rates may apply if PAN is not available
- thresholds are generally applied on an annual basis
- certain payments may have exceptions or special conditions
- always refer to latest updates before final deduction
Frequently Asked Questions
What are TDS codes?
A numeric code used to classify the nature of payment for tax deduction at source.
Why are TDS codes important?
They ensure correct classification in returns and help avoid compliance errors.
Are old sections like 194J still relevant?
They are useful for reference but have been mapped into new sections and codes.
What happens if the wrong TDS code is used?
It may lead to incorrect filings, mismatches, or notices.
Where are TDS codes used?
In TDS returns, challans, and compliance reporting.
Final Thoughts
This article is designed to act as a practical working reference, not just an explanation.
For most users, the goal is simple:
identify the correct code → apply the correct rate → ensure compliance
Need Help with TDS Compliance?
If you need assistance with:
- TDS deduction and classification
- return filing
- reconciliation and notices
our team can help ensure accurate and compliant handling of TDS requirements.