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Income Tax Act 2025 · Collection & recovery

TDS, TCS & Collection of Tax — Income-tax Act 2025

How tax is collected at source — TDS on salary, contractors, rent, professional fees and property, plus TCS, advance tax and the credit you claim in your return.

Chapter XIX of the Income-tax Act, 2025 governs how tax is collected before you file your return — through TDS (Tax Deducted at Source), TCS (Tax Collected at Source) and advance tax. The payer deducts a slice of tax when making certain payments and deposits it against your PAN; you then claim that credit in your return.

Common TDS situations include salary, interest, contractor and professional payments, rent, commission, purchase of property, and payments to non-residents. Each has its own rate and threshold. Getting TDS right matters because mismatches between your return and the AIS/26AS are one of the most common triggers for income-tax notices.

Browse the sections below for the specific deduction provisions, rates and compliance timelines, and use the discussion box to ask about any TDS entry in your Form 26AS.

Sections in this topic

§390
Section 390 of the Income-tax Act, 2025 — TDS, TCS and Advance Tax Payment Framework
Deduction or collection at source and advance payment
§391
Section 391 of the Income-tax Act, 2025 — Direct Payment of Tax When TDS Is Not Deducted
Direct payment
§392
Section 392 of the Income-tax Act, 2025 — TDS on Salary and Accumulated PF Balance
Salary and accumulated balance due to an employee
§393
Section 393 of the Income-tax Act, 2025 — Consolidated TDS Table (Rates, Thresholds & Payments Covered)
Tax to be deducted at source
§394
Section 394 of the Income-tax Act, 2025 — Collection of Tax at Source (TCS)
Collection of tax at source
§395
Section 395 of the Income-tax Act, 2025 — Certificate for Lower or Nil Deduction / Collection of TDS & TCS (Form 128)
Certificates
§396
Section 396 of the Income-tax Act, 2025 — Tax Deducted is Income Received (Gross-Up of TDS & TCS)
Tax deducted is income received
§397
Section 397 of the Income-tax Act, 2025 — Compliance and Reporting for TDS/TCS (Returns, Statements, TAN and Correction Statements)
Compliance and reporting
§398
Section 398 of the Income-tax Act, 2025 — Consequences of Failure to Deduct/Collect or Pay TDS/TCS (Assessee-in-Default, Interest, Disallowance)
Consequences of failure to deduct or pay or, collect or pay
§400
Section 400 of the Income-tax Act, 2025 — Power of Central Government to Relax TDS/TCS Provisions
Power of Central Government to relax provisions of this Chapter
§401
Section 401 of the Income-tax Act, 2025 — Bar Against Direct Demand on Assessee Where TDS Was Deductible
Bar against direct demand on assessee
§402
Section 402 of the Income-tax Act, 2025 — Interpretation (TDS/TCS Definitions Explained)
Interpretation
§403
Section 403 of the Income-tax Act, 2025 — Liability for Payment of Advance Tax
Liability for payment of advance tax
§404
Section 404 of the Income-tax Act, 2025 — Conditions of Liability to Pay Advance Tax (₹10,000 Threshold)
Conditions of liability to pay advance tax
§405
Section 405 of the Income-tax Act, 2025 — Computation of Advance Tax (Formula A = B − C)
Computation of advance tax
§406
Section 406 of the Income-tax Act, 2025 — Payment of Advance Tax by the Assessee on His Own Accord
Payment of advance tax by assessee on his own accord
§407
Section 407 of the Income-tax Act, 2025 — Payment of Advance Tax in Pursuance of an Order of the Assessing Officer
Payment of advance tax by assessee in pursuance of order of Assessing Officer
§408
Section 408 of the Income-tax Act, 2025 — Instalments of Advance Tax and Due Dates
Instalments of advance tax and due dates
§409
Section 409 of the Income-tax Act, 2025 — When an Assessee is Deemed to be in Default (Advance Tax)
When assessee is deemed to be in default
§410
Section 410 of the Income-tax Act, 2025 — Credit for Advance Tax in Regular Assessment
Credit for advance tax
§411
Section 411 of the Income-tax Act, 2025 — When Tax Is Payable and When an Assessee Is Deemed in Default
When tax payable and when assessee deemed in default
§412
Section 412 of the Income-tax Act, 2025 — Penalty Payable When Tax Is in Default
Penalty payable when tax in default
§413
Section 413 of the Income-tax Act, 2025 — Certificate by Tax Recovery Officer and Validity Thereof
Section 413
§414
Section 414 of the Income-tax Act, 2025 — Tax Recovery Officer by Whom Recovery Is to Be Effected
Tax Recovery Officer by whom recovery is to be effected
§415
Section 415 of the Income-tax Act, 2025 — Stay of Recovery Proceedings and Amendment or Cancellation of the Recovery Certificate
Tion thereof
§417
Section 417 of the Income-tax Act, 2025 — Recovery of Tax Through State Government
Section 417
§418
Section 418 of the Income-tax Act, 2025 — Recovery of Tax in Pursuance of Agreements with Foreign Countries
Recovery of tax in pursuance of agreements with foreign countries
§419
Section 419 of the Income-tax Act, 2025 — Recovery of Penalties, Fine, Interest and Other Sums
Recovery of penalties, fine, interest and other sums
§421
Section 421 of the Income-tax Act, 2025 — Recovery by Suit or Under Other Law Not Affected
Recovery by suit or under other law not affected
§422
Section 422 of the Income-tax Act, 2025 — Recovery of Tax Arrear from a Non-Resident's Assets in India
Recovery of tax arrear in respect of non-resident from his assets
§423
Section 423 of the Income-tax Act, 2025 — Interest for Defaults in Furnishing Return of Income (Successor to Section 234A)
Interest for defaults in furnishing return of income
§424
Section 424 of the Income-tax Act, 2025 — Interest for Default in Payment of Advance Tax
Interest for defaults in payment of advance tax
§425
Section 425 of the Income-tax Act, 2025 — Interest for Deferment of Advance Tax (Successor to Section 234C)
Interest for deferment of advance tax
§426
Section 426 of the Income-tax Act, 2025 — Interest on Excess Refund (Successor to Section 234D)
Interest on excess refund
§428
Section 428 of the Income-tax Act, 2025 — Fee for Default in Furnishing Return of Income, Audited Accounts and Reports
Fee for default in furnishing return of income, audited accounts and reports
§429
Section 429 of the Income-tax Act, 2025 — Fee for Default Relating to a TDS/TCS Statement or Certificate (₹200/Day)
Fee for default relating to statement or certificate
§430
Section 430 of the Income-tax Act, 2025 — Fee for Default in Intimation of Aadhaar Number (PAN-Aadhaar Linking Late Fee)
Fee for default relating to intimation of Aadhaar number

Frequently asked questions

What is TDS?
Tax Deducted at Source — the payer deducts tax when making certain payments (salary, rent, contractor/professional fees, property purchase, etc.) and deposits it against your PAN, which you claim as credit in your return.
Why does TDS cause income-tax notices?
Because the department cross-checks your return against the TDS reported in your AIS/26AS. Any mismatch is a common reason for a notice, so reconcile before filing.
Disclaimer: Educational overview of the Income-tax Act, 2025 (effective 1 April 2026), not professional advice. Confirm your position with our team before acting.

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§390 — Section 390 of the Income-tax Act,...§391 — Section 391 of the Income-tax Act,...§392 — Section 392 of the Income-tax Act,...§393 — Section 393 of the Income-tax Act,...§394 — Section 394 of the Income-tax Act,...§395 — Section 395 of the Income-tax Act,...§396 — Section 396 of the Income-tax Act,...§397 — Section 397 of the Income-tax Act,...§398 — Section 398 of the Income-tax Act,...§400 — Section 400 of the Income-tax Act,...§401 — Section 401 of the Income-tax Act,...§402 — Section 402 of the Income-tax Act,...§403 — Section 403 of the Income-tax Act,...§404 — Section 404 of the Income-tax Act,...§405 — Section 405 of the Income-tax Act,...§406 — Section 406 of the Income-tax Act,...§407 — Section 407 of the Income-tax Act,...§408 — Section 408 of the Income-tax Act,...§409 — Section 409 of the Income-tax Act,...§410 — Section 410 of the Income-tax Act,...§411 — Section 411 of the Income-tax Act,...§412 — Section 412 of the Income-tax Act,...§413 — Section 413 of the Income-tax Act,...§414 — Section 414 of the Income-tax Act,...§415 — Section 415 of the Income-tax Act,...§417 — Section 417 of the Income-tax Act,...§418 — Section 418 of the Income-tax Act,...§419 — Section 419 of the Income-tax Act,...§421 — Section 421 of the Income-tax Act,...§422 — Section 422 of the Income-tax Act,...§423 — Section 423 of the Income-tax Act,...§424 — Section 424 of the Income-tax Act,...§425 — Section 425 of the Income-tax Act,...§426 — Section 426 of the Income-tax Act,...§428 — Section 428 of the Income-tax Act,...§429 — Section 429 of the Income-tax Act,...§430 — Section 430 of the Income-tax Act,...

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