TDS on Transport Charges: Rates, Limits, Relaxations and Penalties

| Last updated: 01 October 2025

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This article explains Tax Deducted at Source (TDS) on transport charges, primarily governed by Section 194C of the Income Tax Act. It outlines the applicability of TDS, threshold limits for single and aggregate payments, and the applicable rates (1% or 2% for residents, 20% without PAN). The article also details exemptions for small transporters owning 10 or fewer goods carriages and discusses compliance requirements, including timely filing and potential penalties for non-compliance.

Tax Deducted at Source (TDS) is a mechanism under the Income Tax Act, 1961, where the payer deducts tax at source before making payments for certain services, including transport charges. This ensures timely tax collection and compliance. Specifically, TDS on transport charges falls under Section

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About the Author

Poojitha Raam Vinay

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I simplify complex income tax, TDS, banking, and investment updates into practical insights for taxpayers, salaried professionals, pensioners, and senior citizens. I regularly write on ITR filing, tax compliance, savings schemes, and the latest financial rule changes in India.

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TDS on Transport Charges: Rates, Limits, Relaxations and Penalties

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