Income-tax Act, 2025

Collection of tax at source - Section 394

Collection of tax at source.

394. (1) Every person, as specified in column C of the Table below shall collect tax

(a) on receipts specified in column B;

(b) at the rate as specified in column D; and

(c) at the time of debiting of the amount payable by the buyer or licensee or lessee to the account of the buyer or licensee or lessee or at the time of receipt of such amount from the said buyer or licensee or lessee in cash or by way of a cheque or a draft or any other mode, whichever is earlier.

TABLE

TAX COLLECTION AT SOURCE

Sl. No.

Nature of receipt

Person

Rate of Tax Collected at Source

A

B

C

D

1.

Sale of alcoholic liquor for human consumption.

Seller.

86[2%]

2.

Sale of tendu leaves.

Seller.

87[2%]

3.

Sale of timber whether obtained under a forest lease or otherwise; or any other forest produce (not being timber or tendu leaves) obtained under a forest lease.

Seller.

2%

4.

Sale of scrap.

Seller.

88[2%]

5.

Sale of minerals, being coal or lignite or iron ore.

Seller.

88a[2%]

6.

Sale consideration exceeding ten lakh rupees in case of

(a) motor vehicle; or

(b) any other goods, as may be notified by the Central Government.

Seller.

1%

7.

Remittance under the Liberalised Remittance Scheme of an amount or aggregate of the amounts exceeding ten lakh rupees

Authorised dealer.

(a) 88b[2%] for purposes of education or medical treatment;

(b) 20% for purposes other than education or medical treatment.

8.

Sale of "overseas tour programme package" including expenses for travel or hotel stay or boarding or lodging or any such similar or related expenditure.

.... To read the full section download the app from Google Play store