Question 1

What changed in the New Income Tax Bill 2025 for TDS/TCS?

Accepted Answer

The New Income Tax Bill 2025 renumbers all TDS and TCS sections. Key changes: Section 192 (Salary TDS) → Section 392; Section 194C (Contracts) → Section 393(1) Sl.6(i); Section 194J (Professional Fees) → Section 393(1) Sl.6(iii); Section 206C (TCS) → Section 394. Form numbers also change — Form 24Q → Form 138, Form 26Q → Form 140, Form 27EQ → Form 143, Form 27Q → Form 144. The rates and thresholds remain largely unchanged.

Question 2

What are the most common TDS sections under the New Income Tax Bill?

Accepted Answer

Frequently used sections under the new bill: Sec 393(1) Sl.6(i) — contractor payments (1%/2%), Sl.6(iii) — professional/technical fees (2%/10%), Sl.5 — interest income (10%), Sl.2 — rent (2%/10%), Sl.1(ii) — commission (2%), and Sec 392 — salary TDS at average slab rates.

Question 3

What happens if TDS is not deducted?

Accepted Answer

Non-deduction attracts interest at 1% per month under Section 201(1A). Additionally, the expense becomes disallowed under Section 40(a)(ia) in your income tax return, effectively increasing taxable income by the full payment amount.

Question 4

What is the TDS rate if PAN is not provided?

Accepted Answer

If the deductee does not provide PAN, TDS must be deducted at 20% under Section 206AA, regardless of the prescribed rate. The higher rate applies even if the actual section rate is lower (e.g., 0.1% for purchase of goods becomes 5% without PAN).

Question 5

What is Section 206AB (higher TDS for non-filers)?

Accepted Answer

Section 206AB mandates TDS at double the prescribed rate (or 5%, whichever is higher) for deductees who have not filed their ITR for the past 2 years and whose aggregate TDS/TCS exceeded ₹50,000 in each of those years. Verify compliance on the Income Tax Portal before making payments.

Question 6

When is TDS to be deposited?

Accepted Answer

TDS deducted in any month must be deposited by the 7th of the following month. For March, the due date is 30th April. Late deposit attracts interest at 1.5% per month. TDS on salary (Section 392) follows the same deposit timeline.

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