Does the TDS rate vary for different types of income?
- Posted: 29th September, 2025
- Updated: 30th September, 2025
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https://www.shriramfinance.in/financial-faq-does-the-tds-rate-vary-for-different-types-of-income
Yes, the TDS rate varies for different types of income under Indian tax laws, and the rates and threshold limits have been updated effective from April 1, 2025, for FY 2025-26 (AY 2026-27).
Here’s a summary of key TDS rates and thresholds applicable to various income types for payments made to residents:
| Nature of Income/Payment | Section | Threshold Limit (₹) | TDS Rate (%) |
| Payment of Salary | 192 | Basic exemption limit | As per income tax slab |
| Interest on securities | 193 | ₹ 10,000 | 10 |
| Dividend (individual shareholder) | 194 | ₹ 10,000 | 10 |
| Interest other than securities (banks, co-op, post office) | 194A | ₹1,00,000 (senior citizens), ₹50,000 (others) | 10 |
| Interest other than securities (others) | 194A | ₹ 10,000 | 10 |
| Winnings from lottery, crossword puzzles | 194B | ₹10,000 per transaction | 30 |
| Winnings from horse race | 194BB | ₹10,000 per transaction | 30 |
| Insurance commission | 194D | ₹ 20,000 | 2 |
| Commission or brokerage | 194H | ₹ 20,000 | 2 |
| Rent (individuals/HUF, monthly) | 194-IB | ₹ 50,000 | 2 |
| Rent (others, land/building/furniture) | 194I | ₹50,000 per month | 10 |
| Fees for professional/technical services | 194J | ₹ 50,000 | 10 |
| Income from mutual fund units | 194K | ₹ 10,000 | 10 |
| Compensation on acquisition of immovable property | 194LA | ₹ 5,00,000 | 1 |
| Payment to partners (firm/LLP) | 194T | ₹ 20,000 | 10 |
| Payment for sale of goods by e-commerce operators | 194O | ₹ 5,00,000 | 0.1 |
Key points:
- TDS is deducted only if the payment exceeds the specified threshold limit.
- Senior citizens enjoy higher exemption limits on interest income (₹1 lakh vs ₹50,000 for others).
- Rates differ widely by income type—e.g., 30% on lottery winnings, 10% on dividends and interest, 2% on commissions and insurance.
- For salary, TDS is deducted as per the individual’s income tax slab.
- If PAN is not provided, TDS is generally deducted at a higher rate (20% or as per law).
These updated rates and thresholds aim to reduce compliance burden on small payments and provide relief to taxpayers while ensuring tax collection at source.
You can use the online TDS calculator to know how your TDS is calculated, based on your income slab.
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