The Statutory Brief

IT Act 1961 → 2025 / Section 194A

TDS

Section 194A → Section 393

TDS on interest other than interest on securities (FD, RD, loans)

Section 194A of the old Income-tax Act, 1961 · new section 393 under the Income-tax Act, 2025

New reference Section 393(1), Table Sl. No. 5(ii) and 5(iii); exclusions in 393(4), Sl. No. 7

Income-tax Act, 1961Section 194A

  • TDS at 10% on interest other than interest on securities
  • Threshold: ₹1,00,000 for senior citizens; ₹50,000 for others where payer is a bank, co-op bank or post office; ₹10,000 in other cases
  • Separate section among 30-plus TDS sections

Applies to FY 2025-26 (AY 2026-27) and earlier years.

Income-tax Act, 2025Section 393(1), Table Sl. No. 5(ii) and 5(iii); exclusions in 393(4), Sl. No. 7

  • Covered by section 393(1), Table Sl. No. 5(ii) and 5(iii)
  • Rate and thresholds carried over
  • TDS return codes: 1020 (senior citizen), 1021 (others)
  • Cases where no TDS applies (interest to banks, LIC, co-operative society members, etc.) are listed in section 393(4), Table Sl. No. 7

Applies from tax year 2026-27 (from 1 April 2026).

What changed

All non-salary TDS is consolidated into one tabular section 393. For interest, the rates and thresholds are unchanged; only the citation and return codes change.

Practice notes

  • For interest credited or paid on or after 1 April 2026, quote section 393(1) with the table entry in TDS returns. Using '194A' for these may cause validation errors.
  • Form 15G/15H declarations continue under the new framework.

These are summaries, not the statutory text. Read the bare Act for both sections on the Income Tax Department's official site, which also has a side-by-side comparison utility.

Frequently asked

What is the TDS rate on FD interest under the new Income Tax Act 2025?

10% under section 393(1), Table Sl. No. 5(ii)/5(iii). No TDS if bank, co-operative bank or post office interest is within ₹1,00,000 for senior citizens or ₹50,000 for others; ₹10,000 in other cases.

What is section 194A called in the new Income-tax Act, 2025?

Section 194A of the Income-tax Act, 1961 corresponds to Section 393(1), Table Sl. No. 5(ii) and 5(iii); exclusions in 393(4), Sl. No. 7 of the Income-tax Act, 2025, which applies from 1 April 2026 (tax year 2026-27).

What changed in section 194A under the new Income Tax Act?

All non-salary TDS is consolidated into one tabular section 393. For interest, the rates and thresholds are unchanged; only the citation and return codes change.

Is section 194A still applicable for FY 2025-26?

Yes. Income of FY 2025-26 (AY 2026-27) and earlier years is governed by section 194A of the 1961 Act. Section 393(1), Table Sl. No. 5(ii) and 5(iii); exclusions in 393(4), Sl. No. 7 of the 2025 Act applies from tax year 2026-27.

Related sections

194C→393TDS on payments to contractors and sub-contractors194J→393TDS on fees for professional or technical services, royalty and director's fees