3 weeks ago
Government To Notify Rules For Online Lower, Nil TDS Applications
In India, when someone pays you money, they sometimes keep part of it and send it to the government as tax.
Sometimes the amount they keep is more than what you actually need to pay.
There is a special certificate that tells the payer to take less tax, or no tax at all.
Getting that certificate used to mean a lot of paperwork and visits to tax offices.
Now the government is preparing new rules so you can ask for this certificate online.
The system will check information it already has about you, like old tax returns.
If everything is correct, you will receive the certificate on your computer or phone.
If your details have mistakes or do not match, your application may be turned down.
The government says this will make the process faster, paperless and more transparent, and will especially help smaller taxpayers.
The Income Tax Department is preparing rules to allow taxpayers to apply online for certificates permitting tax deducted at source (TDS) at a lower or nil rate, Parliament was informed on Monday.
Minister of State for Finance Pankaj Chaudhary said the enabling rule is under preparation and will be notified in due course, in a written reply in the Lok Sabha on 10 August.
The online option, enabled by the Finance Act, 2026 under Section 395(1) of the Income-tax Act, 2025, aims to ease the compliance burden on small taxpayers.
Applications will be checked against information already on the income-tax portal, including previously filed returns, the Annual Information Statement, Taxpayer Information Summary and Form 26AS; eligible applicants will get certificates electronically, while those with discrepancies may be rejected.
Residents, non-residents, firms and companies can apply, and the certificates can cover income such as salary, interest, dividends, rent, brokerage and fees for professional or technical services.
- Who
- Minister of State for Finance Pankaj Chaudhary announced the move in a written reply in the Lok Sabha; beneficiaries are taxpayers such as residents, non-residents, firms and companies seeking lower or nil TDS certificates.
- What
- Preparation of rules enabling taxpayers to apply online for certificates permitting tax deducted at source (TDS) at a lower or nil rate.
- Where
- India — Lok Sabha, New Delhi.
- When
- Announced on Monday, 10 August, in Parliament; the enabling rules are to be notified in due course, implementing the Finance Act, 2026 (2026-27 Budget) provision.
- Why
- To ease the compliance burden on small taxpayers, avoid excess tax deductions and long waits for refunds, and make the process faster, paperless and more transparent.
Key facts
- Announcement
- Written reply in the Lok Sabha on Monday (10 August)
- Announced by
- Minister of State for Finance Pankaj Chaudhary
- Legal basis
- Section 395(1) of the Income-tax Act, 2025
- Enabling law
- Finance Act, 2026 (2026-27 Budget provision)
- Applications checked against
- Previously filed returns, Annual Information Statement (AIS), Taxpayer Information Summary (TIS) and Form 26AS
- Certificate delivery
- Issued electronically if conditions are met; applications with discrepancies may be rejected
- Disposal of appeals (2025-26)
- 2.24 lakh, up from 1.11 lakh in 2023-24
- Faceless assessments (FY26)
- 2.13 lakh completed, down from 2.73 lakh in FY24
Quotes
Minister of State for Finance Pankaj Chaudhary
Member of Parliament and finance minister
“Section 395(1) of the Income‑Tax Act, 2025 provides for issuance of certificate for deduction of tax at source at Nil or lower rates. Vide Finance Act, 2026, to ease the compliance burden of small taxpayers, an option has been enabled for the payee, to file the application for issuance of certificate for lower or nil deduction of income‑tax electronically and the certificate may be issued or rejected electronically subject to fulfilment of conditions as may be prescribed. In this regard, the en”
livemint.com
deccanchronicle.com
“the enabling rule is under preparation and will be notified in due course.”
freepressjournal.in
Sources
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