TDS · Section 194J · FY 2026–27
Section 194J: TDS on Professional Fees and Technical Services
Section 194J (TDS on Professional Fees and Technical Services): the TDS rate is 10% (professional) / 2% (technical services). Threshold: Rs. 50,000 per financial year per deductor (raised from Rs. 30,000 in Budget 2025; effective 1 April 2025). From 1 April 2026 the Income-tax Act, 2025 moves it to Section 393(1) Sl. 6(iii), with the same rate and threshold.
Section 194J mandates TDS on payments for professional services, fees for technical services (FTS), royalty, non-compete fees, and director fees. For Indian freelancers offering professional services (design, development, consulting, legal, accounting), this is the section most clients deduct under.
Rate source: Income Tax Department TDS rate chart
10%
10% (professional) / 2% (technical services)
Threshold
₹50K a year
Who deducts
Companies, LLPs, partnerships, audited individuals/HUFs (turnover > Rs. 1 crore or profession receipts > Rs. 50 lakh).
No PAN
20%
Shows up in
Form 26AS & AIS, quarterly
Which clause applies — and at what rate
Rs. 50,000 per financial year per deductor (raised from Rs. 30,000 in Budget 2025; effective 1 April 2025).
| Clause | Covers | Rate |
|---|---|---|
| 194J(a) | Technical services, call centre, film royalty (2%) | 2% |
| 194J(b) | Professional fees, royalty, non-compete, director fees (10%) | 10% |
What it looks like on a real payment
Worked exampleSec 194J
Amount payable to you₹1,00,000
TDS @ 10%− ₹10,000
You receive₹90,000
The ₹10,000 is not lost — it is pre-paid tax, credited in your 26AS and adjusted at filing.
TDS computed on the service value EXCLUDING GST per CBDT Circular 23/2017 (when GST is shown separately on the invoice). If your invoice is Rs. 1,00,000 + 18% GST = Rs. 1,18,000, TDS @ 10% under 194J is Rs. 10,000 (on Rs. 1,00,000), not Rs. 11,800.
Run your own numbersFree 194J calculator — invoice amount in, deduction and take-home out. No signup.What this means for you
If you are in a specified profession — an IT consultant, say — and opt for the presumptive scheme (s.58(2) Sl. 3 of the Income-tax Act 2025, formerly 44ADA), taxable income on Rs. 1,00,000 gross is Rs. 50,000 (50% presumptive). If that is all your income, new-regime tax on it is zero after the s.156 rebate (formerly 87A, for taxable income up to Rs. 12 lakh), so the full Rs. 10,000 TDS comes back at filing. With other income, you get back whatever TDS exceeds your final tax.
Effective since: 1 April 2025 (Rs. 50K threshold).
From 1 April 2026, the Income-tax Act 2025 renumbers this as Section 393(1) Sl. 6(iii). The rate and threshold are unchanged — only the citation moves.
When your client must deposit it — and report it
The client must deposit TDS by the 7th of the month after deduction (30 April for March). It reaches your 26AS only after they file the quarterly TDS statement (Form 26Q), due on these dates — which is why a deduction in March can be invisible until 31 May:
Form 26Q · quarterlyFY 2026–27
Q1 — Apr to Jun31 July
Q2 — Jul to Sep31 October
Q3 — Oct to Dec31 January
Q4 — Jan to Mar31 May
FAQ
What is the TDS rate under Section 194J?
Who deducts TDS under Section 194J?
What is the threshold for Section 194J TDS?
Is TDS under Section 194J deducted on the GST-inclusive amount?
How do I claim TDS deducted under Section 194J in my ITR?
Want the detail on this section specifically? Read the full Section 194J explainer — 194J(a) vs 194J(b), which rate your work attracts, and the threshold.
For the CA reading this
The deadline sheet you already send, with your name on it
Every statutory date for the month — GST returns, advance tax, and the dates your client's own customers owe them: when the TDS they withheld must reach the department, and when the certificate is due. Add your firm's name and forward it as it stands. No signup, no email, nothing to accept.
The image is the one that travels on WhatsApp. Dates are statutory, not advice — the sheet says which rows bind whom.
Sources
Rates as notified for FY 2026–27 and can change. General information, not tax advice. Verify with your CA before you file.
Related sections
Every deduction, tracked to the rupee
Your TDS credits, never lost.
HourSlip logs the expected deduction on every invoice and reconciles it against 26AS — so filing season has no surprises.
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