Next dueTDS / TCS
7 OCTTDS / TCS deposit · Deducted in Sep 2026in 12 days 15 OCTForm 27EQ · TCS return · Jul–Sep 2026in 20 days 31 OCTForm 24Q / 26Q · TDS return · Jul–Sep 2026in 36 days 15 JUNForm 16 · Salary TDS certificate · FY 2026-27in 263 days 30 SEPTax Audit Report · Form 3CA/3CB · AY 2026-27in 5 days 11 OCTGSTR-1 · Outward supplies · Sep 2026in 16 days 15 OCTPF & ESI · Contributions · Sep 2026in 20 days 20 OCTGSTR-3B · Summary return · Sep 2026in 25 days
All due dates
TDS & TCS Live

Section 194N TDS — Rate Chart, Threshold & Applicability

Section 194N covers TDS on Cash withdrawal from bank/post office. This guide explains its rate, threshold and applicability. Section 194N — rate, threshold & applicability...

MS Monika SharmaDirector
Published
Updated
Reading time
4 min
Views
36
Questions
4 answered
  • Expert Reviewed
  • Medium Complexity
Topic
TDS & TCS
Published
August 20, 2026
Last updated
Sep 24, 2026
Reading time
4 min
0:00
Last updated: September 2026Verified against: Government sources

Section 194N TDS explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.

Section 194N covers TDS on Cash withdrawal from bank/post office. This guide explains its rate, threshold and applicability.

Section 194N — rate, threshold & applicability

Section194N
Nature of paymentCash withdrawal from bank/post office
TDS rate2% (higher 2%/5% for non-filers)
Threshold limitCash withdrawals over ₹1 crore in a year
Who deductsBanks and post offices
Rate if PAN not furnishedGenerally 20% (or the applicable higher rate)

When Section 194N applies

  • It applies to Cash withdrawal from bank/post office
  • TDS must be deducted once the payment crosses Cash withdrawals over ₹1 crore in a year
  • The deductor is: Banks and post offices
  • A higher rate applies if PAN is not furnished by the payee

Example

A withdrawal of ₹1.5 crore cash attracts 2% TDS on the excess over ₹1 crore.

Points to note

  • TDS is deducted at the time of credit or payment, whichever is earlier
  • A higher rate applies if the payee has not furnished a PAN
  • Non-filers may attract a higher rate under Sections 206AB/206CCA
  • Always verify the latest rate, as thresholds are periodically revised

TDS compliance essentials

Whichever section applies, the core TDS process is the same:

  • Obtain a TAN before deducting any TDS
  • Deduct at the correct rate at the time of credit or payment, whichever is earlier
  • Deposit the TDS by the 7th of the next month using the right challan
  • File quarterly TDS returns (24Q/26Q/27Q) and issue Form 16/16A to the payee
  • Verify deductions in Form 26AS/AIS and reconcile before filing

Related Section 194N guides

TDS compliance under Section 194N, done right

TaxClue handles TDS deduction, deposit and quarterly returns so you never miss a due date or face interest.

Talk to a tax expert →
Quick recapKey facts & short answers

Key Facts About Section 194N TDS

  • Applies in: All states across India, under the relevant central law.
  • Mode: Mostly online via the official government portal.
  • Typical timeline: Ranges from a few days to a few weeks depending on the case.
  • Non-compliance: May attract penalties, interest or late fees.
  • Expert help: TaxClue completes the entire process end to end for you.

What is the TDS rate under Section 194N?

The TDS rate under Section 194N is 2% (higher 2%/5% for non-filers) on Cash withdrawal from bank/post office.

What is the threshold for TDS under Section 194N?

TDS under Section 194N applies when the payment crosses Cash withdrawals over ₹1 crore in a year.

Section 194N TDS: a key compliance topic in Indian tax and corporate law that businesses and individuals must understand to remain compliant.

Related Services & Guides

Why This Matters

Staying compliant with Indian regulations protects your business from penalties, interest and unnecessary legal trouble. It is always wise to maintain proper records and documentation so that any future scrutiny can be handled smoothly. Rules and thresholds in tds tcs are revised periodically, so it helps to review your obligations at the start of each financial year. Professional guidance from a qualified CA, CS or advocate ensures that filings are accurate and submitted well before the due date.

Small businesses and startups especially benefit from setting up a simple compliance calendar to track recurring deadlines. Government portals now allow most applications and filings to be completed online, reducing paperwork and turnaround time. Keeping your PAN, registration certificates and board resolutions organised makes every subsequent filing faster. When in doubt, it is better to seek clarification early rather than risk a notice or a late-filing penalty later.

A clear understanding of the applicable law helps you make confident, well-informed business decisions. TaxClue's experts regularly assist businesses across India with end-to-end tds tcs support at transparent, affordable pricing. Timely compliance also improves your credibility with banks, investors and government authorities. Reviewing your obligations with a professional at least once a year keeps your business audit-ready and stress-free.

Staying compliant with Indian regulations protects your business from penalties, interest and unnecessary legal trouble. It is always wise to maintain proper records and documentation so that any future scrutiny can be handled smoothly. Rules and thresholds in tds tcs are revised periodically, so it helps to review your obligations at the start of each financial year. Professional guidance from a qualified CA, CS or advocate ensures that filings are accurate and submitted well before the due date.

Was this article helpful?
MS
About the author
846 articles
Monika Sharma Verified expert Director

Last reviewed: Live
Share WhatsAppLinkedInXTelegramFacebookEmail

Disclaimer: This article is for general informational purposes only and does not constitute professional tax, legal or financial advice. Laws, rates and due dates change and can vary by individual case — always verify with the relevant government source (e.g. mca.gov.in, incometax.gov.in) or consult a qualified professional before acting. TaxClue accepts no liability for decisions taken based on this content.

People also ask

Questions, answered

Short, direct answers to the 4 questions readers ask most on this topic.

The TDS rate under Section 194N is 2% (higher 2%/5% for non-filers) on Cash withdrawal from bank/post office.

TDS under Section 194N applies when the payment crosses Cash withdrawals over ₹1 crore in a year.

Banks and post offices.

By the 7th of the following month (30 April for March), with quarterly returns and TDS certificates thereafter.

Readers' favourites

Most viewed articles

All articles →
  1. 01GST State Code and Jurisdiction for West Bengal1,054 reads
  2. 02Variable Dearness Allowance (VDA) — Calculation Method908 reads
  3. 03GST State Code and Jurisdiction for Karnataka793 reads
  4. 04GST State Code and Jurisdiction for Punjab566 reads
  5. 05Shorter Notice for Board Meeting and General Meeting — Rules and...538 reads
  6. 06Income Tax Compliance Calendar 2026-27: All Due Dates Under ITA 2025508 reads
  7. 07Tax Comparison of All Business Structures in India — FY 2026-27493 reads
  8. 08Accounting Entries under GST: Complete Journal Entry Guide with...473 reads
  9. 09Tax Audit Due Date FY 2025-26 — Section 44AB466 reads
  10. 10GST State Code and Jurisdiction for Uttarakhand459 reads
Across topics

Related guides

All guides →
◉
State-wise GuidesGST State Code and Jurisdiction for West Bengal1,054 reads
⚖
Labour ComplianceVariable Dearness Allowance (VDA) — Calculation Method908 reads
◉
State-wise GuidesGST State Code and Jurisdiction for Karnataka793 reads
◉
State-wise GuidesGST State Code and Jurisdiction for Punjab566 reads
Drafting Shorter Notice for Board Meeting and General Meeting — Rules and...538 reads
₹
Direct TaxIncome Tax Compliance Calendar 2026-27: All Due Dates Under ITA 2025508 reads
₹
Income TaxTax Comparison of All Business Structures in India — FY 2026-27493 reads
§
Accounting Standards & BookkeepingAccounting Entries under GST: Complete Journal Entry Guide with...473 reads
₹
Income TaxTax Audit Due Date FY 2025-26 — Section 44AB466 reads
◉
State-wise GuidesGST State Code and Jurisdiction for Uttarakhand459 reads