TDS Rate Chart Section 194A — TDS on Interest (Other Than Securities)
Section 194A — TDS on Interest (Other Than Securities)
Income Tax Act 1961 — s.194A · ITA 2025 — s.393 + 400 + 402 + 2
Rate and threshold
| Condition | Rate |
|---|---|
| All qualifying interest | 10% |
- Threshold
- ₹50,000 p.a. for bank / co-operative society / post office interest (₹1,00,000 for resident senior citizens); ₹10,000 p.a. in any other case
- Timing of deduction
- At credit or payment, whichever is earlier. Deposit by the 7th of the following month (30 Apr for March).
- Who deducts
- Any person other than an individual/HUF; individuals/HUF only if their business turnover exceeded ₹1 crore (₹50 lakh for profession) in the preceding FY
- Payee
- Resident
Threshold history
| Period | Value | Amended by |
|---|---|---|
| Until 31 Mar 2025 | ₹40,000 banks (₹50,000 senior citizens); ₹5,000 others | — |
| From 1 Apr 2025 | ₹50,000 banks (₹1,00,000 senior citizens); ₹10,000 others | Finance Act 2025 |
What this section covers
Interest other than interest on securities — FDs, RDs, loans, unsecured loans, late-payment interest
Worked example
Firm pays ₹8,00,000 interest at 24% on an unsecured loan from a resident lender
₹8,00,000 × 10% = ₹80,000 TDS. Threshold (₹10,000, non-bank payer) is crossed, so TDS applies on the full amount.
The nature of the payment (interest) fixes the section — it cannot be reclassified as commission or fees to change the TDS head.
Under the Income Tax Act 2025
From 1 April 2026, s.194A of the 1961 Act maps to s.393 + 400 + 402 + 2 of the Income Tax Act 2025 (split mapping, per the official CBDT concordance). Consolidated into the s.393 TDS table under the ITA 2025.
Full 1961 → 2025 mapping for s.194A →Frequently asked questions
Is TDS deducted on interest paid to a bank or NBFC?
Interest paid TO a banking company is exempt under s.194A(3)(iii). Interest paid to an NBFC is NOT exempt — TDS at 10% applies.
Can the payee avoid TDS with Form 15G/15H?
Yes, if their estimated total income justifies nil tax — Form 15G (others) or 15H (senior citizens) filed with the payer.
Does 194A apply to interest on a partner's capital?
No. Interest to partners is covered by s.194T (10% above ₹20,000 p.a.) from 1 Apr 2025, not s.194A.