One of the more operationally disruptive — if quietly so — changes to come with the Income-tax Act, 2025 is a restructured, code-based numbering system for TDS provisions. If your accounting team, payroll processor, or outsourced compliance vendor is still citing familiar section numbers like 194C (contractor payments), 194J (professional fees), or 194H (commission and brokerage) for TDS deducted from 1 April 2026 onward, those citations are technically obsolete under the new Act.
The underlying obligation hasn't changed: TDS still needs to be deducted on the same categories of payment, at broadly the same rates in most cases, and deposited by the same 7th-of-the-following-month deadline. What's changed is purely the citation — the new Act uses a restructured section table, and quarterly TDS return filings on the portal now expect the updated codes.
This is exactly the kind of change that doesn't show up as an error until it does — a return filed with an old-style citation may still process, right up until it triggers a portal validation mismatch or a query during assessment. We've already seen this catch out businesses relying on payroll software that hadn't pushed an update in time for the new financial year.
What to check: confirm with your payroll provider or accounting software vendor, in writing, that their system has been updated to the new section codes — don't assume a routine software update covered this automatically. If you prepare TDS deductions manually or through a spreadsheet-based process, your templates need the same review.
If you're not certain whether this affects a specific vendor arrangement or payment category your business handles, that's a quick, worthwhile conversation to have before your next quarterly TDS return cycle rather than after.