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TDS calculator: how it works
Check the payment is above the threshold, then multiply it by the TDS rate. On a ₹1,00,000 professional fee, TDS at 10% is ₹10,000; you pay the professional ₹90,000 and deposit ₹10,000 with the government.
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TDS rates and thresholds for 2026-27
For payments to residents under section 393(1) of the Income-tax Act 2025. TDS applies once the threshold is crossed; for yearly thresholds, count every payment to the same payee in the tax year.
| Payment | Rate | TDS applies when | Table item (was) |
|---|---|---|---|
| Contractor: individual or HUF | 1% | One payment over ₹30,000, or over ₹1,00,000 in the year | 6(i) (194C) |
| Contractor: company, firm or other | 2% | One payment over ₹30,000, or over ₹1,00,000 in the year | 6(i) (194C) |
| Professional fees | 10% | Over ₹50,000 in the year | 6(iii) (194J) |
| Fees for technical services | 2% | Over ₹50,000 in the year | 6(iii) (194J) |
| Royalty | 10% | Over ₹50,000 in the year | 6(iii) (194J) |
| Director’s fees (not salary) | 10% | Any amount | 6(iii) (194J) |
| Commission or brokerage | 2% | Over ₹20,000 in the year | 1(ii) (194H) |
| Rent: land, building or furniture | 10% | Over ₹50,000 for a month | 2(ii) (194-I) |
| Rent: plant and machinery | 2% | Over ₹50,000 for a month | 2(ii) (194-I) |
| Rent paid by an individual or HUF not under audit | 2% | Over ₹50,000 for a month | 2(i) (194-IB) |
How to use the TDS calculator
- Choose what the payment is for.
- Enter the amount, before GST if the invoice shows GST separately.
- Add what you paid the same payee earlier this tax year, for yearly thresholds.
- Say whether the payee gave a PAN, and read the TDS and the net payment.
TDS, worked through
A company pays a design studio (a firm) ₹40,000 in May and ₹45,000 in August for professional services. After May, the year’s total of ₹40,000 is under ₹50,000, so no TDS. The August payment takes the total to ₹85,000, so TDS applies: 10% of ₹45,000 is ₹4,500, and if nothing was deducted in May, another ₹4,000 is due on that payment.
The same company pays a transport contractor (a company) ₹25,000 a month. Each payment is under ₹30,000, but the fifth one takes the year past ₹1,00,000, so 2% TDS applies from then on, and on the earlier payments if none was deducted.
What this calculator does not cover
- TDS on salary, which follows the employee’s slab rates.
- Payments to non-residents, which have their own rates and treaty rules.
- TDS on buying goods (0.1% above ₹50 lakh a year), buying property, and payments by individuals and HUFs not under audit to contractors and professionals above ₹50 lakh a year.
- Lower or nil deduction certificates, which override the rate for the payee named in them.
- Due dates, returns and Form 16A. Check them on the Income Tax Department’s TDS pages or with your accountant.
Questions people ask
How do I calculate TDS?
Check the payment is above the threshold, then multiply it by the TDS rate. On a ₹1,00,000 professional fee, TDS at 10% is ₹10,000; you pay the professional ₹90,000 and deposit ₹10,000 with the government.
What are the TDS rates for 2026-27?
For payments to residents: contractors 1% (individual or HUF) or 2% (others); professional fees 10%; fees for technical services 2%; royalty 10%; commission or brokerage 2%; rent of land, buildings or furniture 10%; rent of plant and machinery 2%. The rates did not change when the Income-tax Act 2025 took effect on 1 April 2026.
What are the thresholds?
Contractors: more than ₹30,000 in one payment or ₹1,00,000 in the year. Professional and technical fees and royalty: more than ₹50,000 in the year. Commission: more than ₹20,000 in the year. Rent: more than ₹50,000 for a month or part of a month. Director’s fees have no threshold.
What if the payee has no PAN?
Deduct at 20%, or at the normal rate if that is higher. Ask for the PAN before you pay; it also lets the payee claim the TDS against their own tax.
Is TDS deducted on the GST part of an invoice?
Not when the invoice shows GST separately: deduct TDS on the amount before GST. If GST is not shown separately, deduct on the whole amount.
What happened to sections 194C, 194J and 194I?
From 1 April 2026 they are rows in one table under section 393(1) of the Income-tax Act 2025: contractors are item 6(i), professional and technical fees item 6(iii), commission item 1(ii) and rent item 2. Payments made up to 31 March 2026 still follow the 1961 Act.