Schedule IX of the Income-tax Act, 2025 gives a deduction under section 48 for amounts deposited in a tea, coffee or rubber development account, or 40% of the profits of that business computed before the deduction, whichever is less.
Schedule IX is not a TDS rate table. It is read with section 48 and carries the tea, coffee and rubber development account deduction. TDS rates are in the tables inside section 393.
What Schedule IX actually gives
Schedule IX is a business deduction for plantation businesses, read with section 48 — the successor to section 33AB of the Income-tax Act, 1961. It is one of two Schedules that carry a deduction of this kind, the other being Schedule X for the Site Restoration Fund under section 49.
The quantum in paragraph 1 is the lower of two figures: the amount deposited in the account, or 40% of the profits of that business computed under the head Profits and gains of business or profession before making any deduction under this paragraph.
The ordering rule in paragraph 1(2) is easy to miss and valuable: the deduction is allowed before set off of any brought-forward loss under section 112. That preserves the time-limited business loss for later years.
The Income-tax Act, 2025 takes effect from 1 April 2026 and applies from tax year 2026-27. The Income-tax Act, 1961 continues to govern every year up to 31 March 2026 because of the repeal and savings provision in section 536. The Schedule contents described here are taken from the Act as enacted, incorporating the corrigenda notified in the Gazette on 3 September 2025.
Where each provision actually sits
| Topic | Income-tax Act, 1961 | Income-tax Act, 2025 |
|---|---|---|
| Tea, coffee and rubber development account | Section 33AB | Section 48 with Schedule IX |
| Site Restoration Fund | Section 33ABA | Section 49 with Schedule X |
| 40% of profits limit | Section 33AB(1) | Schedule IX, paragraph 1(1)(b) |
| Deduction before set off of losses | Section 33AB(1), proviso | Schedule IX, paragraph 1(2) |
| Carry forward of business loss | Section 72 | Section 112 |
| TDS rates | Sections 194 series and 195 | Section 393 |
The deduction and its conditions
Paragraph 1(1) — the quantum
The assessee is allowed a deduction of (a) the amount or aggregate of amounts deposited in the account as specified in paragraph 2, or (b) 40% of the profits of that business computed under the head Profits and gains of business or profession before making any deduction under this paragraph — whichever is less.
Paragraph 1(2) — the ordering rule
The deduction is allowed before allowing set off of any loss brought forward from earlier tax years under section 112. Because a section 112 business loss expires after eight tax years while this deduction does not create a carry-forward, taking the deduction first is to the assessee's advantage — and the Schedule mandates it.
Paragraph 2 — who can claim and by when
The deduction is allowed if the assessee is carrying on the business of growing and manufacturing tea, coffee or rubber in India during the tax year, and has deposited the amount within the period and in the manner the paragraph specifies. Read paragraph 2 in full for the deposit deadline and the approved accounts.
The rest of the Schedule
The Schedule continues with the conditions on utilisation of the deposited amount, the consequences of withdrawal for purposes other than those permitted, and the treatment where the business is discontinued or the asset acquired out of the account is transferred within the specified period.
Its companion — Schedule X
Schedule X, read with section 49, is the Site Restoration Fund deduction for businesses prospecting for, or extracting or producing, mineral oils. The structure is identical but the cap is 20% of profits rather than 40%, and paragraph 1(3) treats interest credited in the specified account as a deposit.
Where TDS rates actually are
If you came here for TDS rates: they are in the tables inside section 393, with salary in section 392 and TCS in section 394. Certificates for lower or nil deduction are section 395, compliance and reporting section 397, and consequences of default section 398.
Worked example
A tea-growing and manufacturing company for tax year 2026-27.
| Step | Working | Amount |
|---|---|---|
| Profits of the business before this deduction | Under the business head | ₹6,00,00,000 |
| Amount deposited in the tea development account | Within the prescribed period | ₹2,80,00,000 |
| 40% of profits | 40% × ₹6,00,00,000 | ₹2,40,00,000 |
| Deduction allowed | Lower of deposit and 40% | ₹2,40,00,000 |
| Brought-forward business loss | Section 112 | ₹1,00,00,000 |
| Order of set off | Deduction first, under paragraph 1(2) | Loss set off against the balance |
The ₹40,00,000 of deposit above the 40% cap gets no deduction this year. And because paragraph 1(2) applies the deduction before the brought-forward loss, the time-limited section 112 loss is preserved for later years rather than being consumed first.
Compliance checklist
- Confirm the business is growing and manufacturing tea, coffee or rubber in India during the tax year.
- Deposit within the period and in the manner paragraph 2 specifies.
- Compute 40% of profits before this deduction and claim the lower of that and the deposit.
- Apply the deduction before set off of brought-forward losses under section 112.
- Track utilisation and withdrawals; misuse triggers the claw-back provisions in the Schedule.
- For the mineral oils equivalent, use Schedule X with section 49, capped at 20%.
- For TDS rates, go to section 393, not to a Schedule.
Common mistakes
- Expecting a TDS rate table in Schedule IX.
- Computing 40% on profits after this deduction rather than before it.
- Setting off brought-forward losses before claiming the deduction.
- Depositing after the period specified in paragraph 2.
- Confusing Schedule IX with Schedule X; one is 40% for tea, coffee and rubber, the other 20% for mineral oils.
All sixteen Schedules of the Income-tax Act, 2025
Because the numbering is widely misquoted, the full list is reproduced below from the Act as enacted. Note that Schedules II to VII are all exemption lists, split by who is claiming rather than by what the income is.
| Schedule | Read with | Subject as enacted |
|---|---|---|
| I | section 9(12) | Conditions for certain activities not to constitute business connection in India |
| II | section 11 | Income not to be included in total income |
| III | section 11 | Income not to be included in total income of eligible persons |
| IV | section 11 | Income not to be included in total income of eligible non-residents, foreign companies and other such persons |
| V | section 11 | Income not to be included in total income of certain eligible persons including investment funds, business trusts and their unit holders |
| VI | section 11 | Income not to be included in total income of certain eligible persons in an International Financial Services Centre or having income therefrom |
| VII | section 11 | Persons exempt from tax |
| VIII | section 12 | Income not to be included in the total income of political parties and electoral trusts |
| IX | section 48 | Deduction for tea, coffee and rubber development accounts |
| X | section 49 | Deduction for Site Restoration Fund |
| XI | section 2(91) | Recognised provident funds, approved superannuation funds and approved gratuity funds |
| XII | section 51 | Minerals, and groups of associated minerals |
| XIII | section 45(2) | List of articles or things |
| XIV | section 55 | Insurance business |
| XV | section 123 | Deduction for life insurance premia, contribution to provident fund, subscription to certain equity shares, etc. |
| XVI | section 350 | Permitted modes of investment or deposits by a registered non-profit organisation |
This is an explanatory guide, not tax advice, and it does not reproduce the section in full. Read the bare text of the section before you rely on it, and check for later amendments, the Income-tax Rules made under the new Act, and CBDT circulars and notifications.