Question 1

Who deducts TDS on my freelance invoices?

Accepted Answer

Your client, when they pay you. Under the Income Tax Act the payer is responsible for deducting tax at source on qualifying payments and depositing it against your PAN. You receive the net amount and claim credit for the TDS from your Form 26AS / AIS when you file your return.

Question 2

What is the difference between Section 194J and 194C?

Accepted Answer

Section 194J covers fees for professional and technical services at 10%, with a concessional 2% rate for call-centre operators and royalty or non-compete fees. Section 194C covers payments for work contracts and advertising at 1% for individuals and HUFs, and 2% for everyone else.

Question 3

Is TDS calculated on the amount including GST?

Accepted Answer

No. When GST is shown separately on the invoice, TDS is deducted only on the taxable value of the service. That is why this wizard asks for the invoice amount excluding GST.

Question 4

Is there a minimum amount below which TDS does not apply?

Accepted Answer

Yes. Section 194J applies only when payments to a payee exceed ₹50,000 in a financial year (raised from ₹30,000 on 1 April 2025). Section 194C does not apply if a single payment is ₹30,000 or less and the annual total stays under ₹1,00,000. From 1 April 2026 both sit under Section 393 of the Income-tax Act, 2025. If you do not furnish a PAN, the rate is 20% under Section 206AA.

Freelancer TDS deductor wizard

Are you billing as an Individual/HUF or a Company/Firm?

Frequently asked questions