The 60-second version
Section 194T requires firm/LLP to deduct 10% TDS on partner remuneration and interest when aggregate exceeds ₹20,000 per year per partner — file 26Q quarterly.
194T is new partner lane — separate from 194J professional fees
Section 194T applies from FY 2025-26 — 10% TDS on partner remuneration and interest paid by partnership/LLP to resident partners.
Threshold ₹20,000 aggregate per partner per FY — deduct when crossed.
Commission lane: Section 194H guide.
Partner payment TDS
| Section | Rate | Payment |
|---|---|---|
| 194T | 10% | Partner salary + interest |
| 194H | 5% | Commission |
| 194J | 10% | Professional fees to outsider |
| 40(b) | Cap | Partner remuneration book profit limit |
194T sequence
TAN
Firm/LLP TAN active.
Partner PAN
All partners on file.
Track ₹20k
Per partner cumulative.
Deduct 10%
On remuneration + interest.
26Q
Quarterly return.
Flow
194T kit
- TAN.
- Partner PANs.
- Remuneration ledger.
- Challan.
- 26Q ACK.
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Interest to partner
Partner capital interest also under 194T — not only salary.
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0 of 4 checked
Pvt ltd director?
Section 192 salary — not 194T.
Below ₹20k?
No 194T until cumulative crosses.
NRI partner?
Section 195 — not 194T.
40(b) cap?
Remuneration must be within 40(b) — 194T still applies.
LLP only?
Partnership firm and LLP both covered.
Effective date?
FY 2025-26 onwards — verify notification.
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