Section 194Q → Section 226
TDS on purchase of goods
Quick Answer
Section 194Q of the Income Tax Act, 1961 (TDS on purchase of goods) corresponds to Section 226 of the Income-tax Act, 2025, effective 1st April 2026. Status: Retained.
What changed for Section 194Q
In the 1961 statute, Section 194Q deals with TDS on purchase of goods. TDS @ 0.1% by the buyer on purchase of goods exceeding Rs. 50 Lakhs if the buyer's turnover is > Rs. 10 Crores.
The new code maps this to Section 226: the provision is retained and renumbered as Section 226 of the Income-tax Act, 2025, applying from 1st April 2026. Retained. Acts as a mirror to TCS under 206C(1H). If TDS is deducted under 194Q, TCS is not applicable.
On the ground, changes to Section 194Q carry a Critical impact. Governs the B2B supply chain and large-scale trading.
Sec 194Q
Provision Summary
TDS @ 0.1% by the buyer on purchase of goods exceeding Rs. 50 Lakhs if the buyer's turnover is > Rs. 10 Crores.
Sec 226
Provision Summary
Retained. Acts as a mirror to TCS under 206C(1H). If TDS is deducted under 194Q, TCS is not applicable.
Key Changes & Highlights
- Cross-verification logic between 194Q (TDS) and 206C(1H) (TCS) fully automated in the portal.
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Frequently Asked Questions
What does Section 194Q of the Income Tax Act 1961 deal with?
Section 194Q of the Income Tax Act, 1961 covers TDS on purchase of goods. TDS @ 0.1% by the buyer on purchase of goods exceeding Rs. 50 Lakhs if the buyer's turnover is > Rs. 10 Crores.
Where does Section 194Q of the ITA 1961 go under the Income-tax Act, 2025?
Section 194Q of the Income Tax Act, 1961 maps to Section 226 of the Income-tax Act, 2025, effective 1st April 2026 (status: Retained). Retained. Acts as a mirror to TCS under 206C(1H). If TDS is deducted under 194Q, TCS is not applicable.
Why does the change to Section 194Q matter for taxpayers?
The transition impact for Section 194Q is rated Critical. Governs the B2B supply chain and large-scale trading.
What are the key changes to Section 194Q under the Income-tax Act, 2025?
Cross-verification logic between 194Q (TDS) and 206C(1H) (TCS) fully automated in the portal. These points are specific to Section 194Q (TDS on purchase of goods).
Disclaimer: This mapping of Section 194Q (TDS on purchase of goods) to Section 226 of the Income-tax Act, 2025 is for educational and reference purposes only, based on publicly available drafts and circulars. As Section 194Q is currently marked Retained, always confirm its treatment with a qualified Chartered Accountant before filing or making compliance decisions.
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