GleamTax Insight

Section 194T – TDS on Payments to Partners

Section 194T of the Income-tax Act mandates deduction of TDS @10% on payments made by a Partnership Firm or LLP to its partners by way of salary, remuneration, commission, bonus, or interest, where the aggregate payment exceeds ₹20,000 in a financial year. TDS is required to be deducted at the time of credit or payment, whichever is earlier, and is applicable from FY 2025-26. Non-compliance may result in interest, penalty, and disallowance of expenditure under the Act.