Copyright software

This query is : Resolved

Quick Summary

TDS applies on software license payments if treated as royalty. Under Income-tax Act, 2025, rate is generally 10% (above 50,000). However, for standard software purchases, TDS depends on contract terms and nature of rights.

Rajkumar Gutti

Rajkumar Gutti (Querist)
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21 April 2026 New copyright TDS software purchased for one year licence. Is tds applicable, if yes under which sec. And whate rate.

Aashok Kumar Sharma

Aashok Kumar Sharma

(Expert)
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22 April 2026 Yes, TDS is generally applicable if the 1-year software licence payment is in the nature of royalty/licence fee. For payments on or after 1 April 2026, refer section 393(1), Table Sl. No. 6(iii) of the Income-tax Act, 2025. Rate is generally 10%, subject to threshold of ₹50,000.

Important caution: this answer assumes it is a licence to use software/IP. If the transaction is merely a plain purchase of a copyrighted article / standard off-the-shelf software from a reseller without royalty character, the position can need closer review based on the agreement, invoice wording, and rights granted. So the agreement terms matter before final deduction treatment is locked. This is an inference based on the phrase “one year licence,” which usually points toward royalty/licence-fee treatment.

Rajkumar Gutti

Rajkumar Gutti (Querist)
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22 April 2026 धन्यवाद सर, Thanks sir

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