Section 194-O → Section 225
TDS on payment of certain sums by e-commerce operator to e-commerce participant
Quick Answer
Section 194-O of the Income Tax Act, 1961 (TDS on payment of certain sums by e-commerce operator to e-commerce participant) corresponds to Section 225 of the Direct Tax Code 2025 (Income-tax Act, 2025), effective 1st April 2026. Status: Retained.
Sec 194-O
Provision Summary
E-commerce platforms (Amazon/Flipkart) must deduct 1% TDS on the gross amount of sales to participants.
Sec 225
Provision Summary
Retained. Rate standardized to 0.1% to prevent liquidity crunch for small online sellers.
Key Changes & Highlights
- Massive rate reduction from 1% to 0.1% to support the digital economy.
Frequently Asked Questions
What does Section 194-O of the Income Tax Act 1961 deal with?
Section 194-O (TDS on payment of certain sums by e-commerce operator to e-commerce participant) E-commerce platforms (Amazon/Flipkart) must deduct 1% TDS on the gross amount of sales to participants.
What is the new section number for Section 194-O under the Direct Tax Code 2025?
Section 194-O of the ITA 1961 maps to Section 225 of the Direct Tax Code 2025 (Income-tax Act, 2025), effective from 1st April 2026.
What is the status of Section 194-O under the new tax code?
Section 194-O is marked as "Retained" with status "Modified". Impact: Very High - Direct impact on every seller on digital marketplaces.
What are the key changes to Section 194-O under DTC 2025?
Massive rate reduction from 1% to 0.1% to support the digital economy.
Disclaimer: This page is for educational and reference purposes only. Section mappings are based on publicly available drafts and circulars. Always consult a qualified Chartered Accountant before filing or making compliance decisions under the Direct Tax Code 2025.
Need professional help on Section 194-O?
Compare trusted providers — both offer DTC 2025-ready CA services.
*Affiliate links — we may earn a small commission at no extra cost to you. Disclosure.
Want to calculate tax on this section?