TDS, Basics for Individuals

Real threshold increases this year

Income type	FY 2025-26 threshold	Rate
Bank interest	50,000 rupees (1,00,000 for senior citizens)	10%
Rent you pay (individual, not under audit)	50,000 rupees per month	2% (cut from 5%)
Professional fees you receive	50,000 rupees per year (up from 30,000)	10% (2% for technical services)

The rent rate cut is the one people miss: individuals paying rent above 50,000 rupees a month deduct TDS themselves under Section 194-IB (individual rent TDS), and the rate dropped from 5% to 2% this year.

Filing it yourself is simpler than it sounds. If you are deducting TDS on rent as an individual, you do not need a TAN (tax deduction account number), you file a one time statement in Form 26QC using just your PAN, and issue Form 16C to your landlord as proof.

One compliance burden disappeared entirely: Section 206AB (higher TDS penalty for non-filers), which used to force higher deduction on payments to people who had not filed returns, has been removed.

TDS sections you’ll encounter as a recipient

Section	Nature	Rate	Threshold
192	Salary	Slab rate	Based on estimated annual income, depends on the regime declared to your employer
194	Dividend	10%	10,000 rupees/year (raised from 5,000)
194S	Virtual digital assets	1%	50,000 rupees/year (10,000 for specified persons)

TDS sections you’ll encounter if you run a business or profession

These apply on the deductor side, relevant once you are paying others rather than just receiving income yourself:

Section	Nature	Rate	Threshold
194C	Contractor payments	1% individual/HUF, 2% others	30,000 rupees per payment or 1,00,000 rupees aggregate/year
194H	Commission/brokerage	2% (cut from 5%)	20,000 rupees/year (raised from 15,000)
194J	Professional fees paid	10% professional, 2% technical services	30,000 rupees/year
194Q	Goods purchase	0.1%	50 lakh rupees from one seller/year, only if your turnover exceeds 10 crore rupees

TCS on overseas remittances, Section 206C(1G)

Money sent abroad under the Liberalised Remittance Scheme draws TCS once your combined remittances cross 10 lakh rupees in a financial year. Beyond that threshold, the applicable rate depends on purpose: 20% for investment or general purposes, 2% for self-funded education and medical remittances (cut down this year from the earlier 5%), and nil where education is funded through a qualifying education loan.

It is a credit, not an extra cost. TCS collected this way gets claimed against your tax liability when you file your ITR, or refunded if there is no offsetting liability to set it against.

Reconciling Form 26AS and the AIS

Everything covered above should show up in Form 26AS. The AIS goes further, it also picks up high value transactions reported under the Statement of Financial Transactions, property purchases, large deposits, mutual fund investments, even where nothing was actually deducted.

A mismatch against your own records gets raised as feedback directly on the AIS portal, agree, partially agree, or disagree with a reason. It is flagged rather than silently corrected, so keep supporting documentation ready before you respond. An unaddressed mismatch is a common trigger for an otherwise routine return drawing a follow up query.