BooksIQTDS applies at 10% on professional fees, technical services, royalty, and director sitting fees once the aggregate paid to a single payee in an FY exceeds ₹50,000 (most categories) — ₹30,000 still applies to older sub-clauses.
Key points
- The deductor is any person liable to tax audit, plus the government, any company, firm, or trust.
- The 10% rate applies to professional fees, fees for technical services, royalty, non-compete fees, director sitting fees, and remuneration paid to non-executive directors.
- A reduced 2% rate applies where the payee operates a call centre.
- The threshold is ₹50,000 per payee per financial year (raised from ₹30,000 by Finance Act 2025 with effect from FY 2025-26), and there is NO threshold for director sitting fees — TDS applies on the first rupee.
- The no-PAN rate steps up to 20%.
Reference: §194J, ITA 1961 — under ITA 2025 (FY 26-27 onwards), this is §393(1) Sl.6(iii)
This page is general information for Indian businesses, current as of the
financial year shown above — not legal or tax advice. Tax law changes,
and how a provision applies depends on your specific facts. Confirm the
current position with a qualified professional before you act.
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