TDS Forms Updated: Partner Payments to Be Reported Separately Under New Rule 194T [Read Order]
CBDT introduces Section 194T to mandate TDS reporting on payments made by firms to their partners in Forms 26Q and 27Q
TDS Forms Updated – TDS Forms – New Rule 194T – taxscan
TDS Forms Updated – TDS Forms – New Rule 194T – taxscan
The Ministry of Finance, through the Central Board of Direct Taxes ( CBDT ), issued Notification No. G.S.R. 195(E) dated March 27, 2025, introducing an amendment to the Income-tax Rules, 1962. The notification announces the inclusion of a new TDS provision—Section 194T, aimed at improving the reporting of payments made by firms to their partners.
This amendment, titled the Income-tax (Seventh Amendment) Rules, 2025, has come into effect from the date of its publication in the Official Gazette, i.e., March 27, 2025.
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What is Section 194T?
Section 194T mandates the deduction and reporting of TDS on certain payments made by a partnership firm to its partners, including Salary, Remuneration, Commission, Bonus, Interest
Changes to TDS Forms
To accommodate Section 194T, changes have been made to two key TDS reporting forms:
Form 26Q (for payments to residents):
- The heading has been updated to include “194T” after “194S”.
- In the annexure (Note 16), a new row has been added for payments under Section 194T.
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Form 27Q (for payments to non-residents):
- “194T” has been added after “194N” in the heading.
- In Note 13, the section now includes:
- “194T – Payment to a partner of a firm”
- “195 – Other sums payable to a non-resident”
| Form | Section Added | Payment Type | Updated Table Entry |
| Form 26Q | 194T | Salary, remuneration, commission, bonus, or interest to a partner | 194T – Payment to a partner of a firm |
| Form 27Q | 194T | Salary, remuneration, commission, bonus, or interest to a partner | 194T – Payment to a partner of a firm |
| 195 | Other sums payable to a non-resident | 195 – Other sums payable to a non-resident |
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These updates make it mandatory for firms to separately report all such payments under the appropriate section during TDS return filings.
To Read the full text of the Notification CLICK HERE
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