How much TDS do I deduct on professional fees?
For payments from 1 April 2026 the rule is section 393(1) of the Income-tax Act, 2025, Table Sl. No. 6(iii), which replaces section 194J. Professional fees and ordinary royalty carry TDS at 10%. Technical services carry 2%. The limit is ₹50,000 paid to one person across the year.
Once your payments to that person pass the limit, TDS applies to the entire payment. You deduct it when you credit the amount to their account or pay it, whichever comes first. A company paying a consultant ₹80,000 deducts ₹8,000 at 10%.
This row applies to a 'specified person' as payer: anyone other than an individual or HUF, or an individual or HUF whose business turnover in the preceding tax year was above ₹1 crore or whose professional receipts were above ₹50 lakh. A smaller individual or HUF payer deducts 2% on professional fees only above ₹50 lakh paid to one person in the year (Table Sl. No. 6(ii), old section 194M).
For payments before 1 April 2026, FY 2025-26, section 194J of the 1961 Act carries the same rates and limits. The TDS rate finder takes what you pay and who you pay, then shows whether TDS applies, the rate, the rupees to deduct and the section.
Common questions
What rate applies to technical fees?
2%, under the same row. The 2% rate covers technical services, film royalty and payments to call centres. Professional services are at 10%.
What if my payments to one person cross ₹50,000 partway through the year?
TDS applies from the payment that crosses the limit. The text we read does not say whether the earlier payments also carry tax, so we confirm that case with you on a call.
Does the 10% change if the payee has no PAN?
The rate for a payee without PAN is not part of the tool. Tell us the case and we confirm the rate.
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