Apply for a lower or nil TDS certificate when your income is below the taxable limit but TDS will be deducted.
Jurisdiction
All of India
Who applies
Individuals, companies, and entities who receive income on which TDS is deducted but whose actual tax liability on that income is nil or lower than the TDS rate, and who wish to prevent excess TDS during the financial year
Typical time
30–60 days from application (the officer has 30 days to issue or reject the certificate; if not issued in 30 days, the certificate is deemed granted)
Fee
Free
| # | Document | Type needed | Purpose |
|---|---|---|---|
| 1 | PAN Card | Self-attested Copy | Required for login to the e-Filing portal and as primary identifier for the application |
| 2 | Audited financial statements for the preceding 3 years | Self-attested Copy | Provide income history to justify the lower TDS rate; officer reviews past financials to assess whether lower rate is warranted |
| 3 | Advance tax / self-assessment tax payment challans | Download / Print | Demonstrate timely tax compliance; officers verify that previous year taxes are paid before granting the certificate |
| 4 | Computation of estimated income for the current year | Soft copy (PDF) | Detailed income estimate showing how the lower tax rate is justified — includes income sources, deductions, set-off of losses, and estimated tax liability |
| 5 | ITR filed for preceding 3 assessment years | Download / Print | Tax officer cross-references past ITR filings to verify income consistency and absence of defaults |
| 6 | Outstanding demand / dues clearance (if any)(optional)Required if there are outstanding tax demands against the applicant | Download / Print | Any outstanding income tax demand must be addressed or explained; unresolved demands may cause the application to be rejected |
| 7 | Tax Residency Certificate (for DTAA applicants)(optional)Only for non-resident applicants claiming DTAA benefits | Original | Non-residents claiming lower TDS under a tax treaty must provide a TRC from their home country certifying their tax residency status |
Original documents: Carry originals only for in-person visits — do not hand them over permanently unless explicitly required.
Identify the nature of income and the relevant TDS section: Section 194J (professional fees), 194A (interest), 194C (contractor payments), 194I (rent), 194H (commission), 192 (salary) or other applicable sections. Estimate your total income for the year, apply relevant deductions and exemptions, and compute the actual tax liability. If the effective tax rate on this income is lower than the TDS rate for that section, you are eligible to apply under Section 197 for a nil or lower rate certificate.
Log in to incometax.gov.in using your PAN and navigate to 'e-File > Income Tax Forms > File Income Tax Forms'. Search for 'Form 13 — Application for nil or lower deduction of tax at source under Section 197'. Select the applicable Assessment Year and fill in the form: nature of income, name and TAN of the deductor (payer), amount of income expected, TDS section, estimated income from all sources, deductions, and estimated tax payable. Provide details for all payers from whom TDS is deducted.
Upload supporting documents through the e-Filing portal along with Form 13: last 3 years' audited financials or ITR acknowledgements, advance tax payment challans, computation of estimated income for the current year, and any other documents the officer may require such as business contracts or agreement copies. Ensure the documents clearly show the basis for claiming a lower TDS rate. Form 13 for non-residents may require additional documents including Tax Residency Certificate and DTAA details.
After submission, the Form 13 application is routed to the Jurisdictional Tax Deduction Account Number (TAN) Assessing Officer or the International Taxation AO (for non-residents). The officer may call for additional documents or information through the portal. If no response or order is issued within 30 days of application, the certificate is deemed granted (per Section 197 proviso). Track the status of your application on the e-Filing portal under 'e-File > View Filed Forms'.
Upon approval, a certificate authorising nil or lower TDS deduction is issued by the AO in Form 13 (which specifies the deductor's name and TAN, the nature of income, the rate of deduction, and the validity period). The certificate is available for download on the e-Filing portal. Download and share a copy of the certificate with each deductor (payer) from whom you receive payments. The deductor is then required to deduct TDS at the lower rate specified in the certificate for payments made during the validity period.
Income Tax Department, Ministry of Finance
Steps 4–5 — review of Form 13 application and issuance of certificate
Reviews the Form 13 application, examines supporting financials and income estimates, verifies compliance history, and grants or rejects the nil or lower TDS certificate.
Income Tax Department — International Taxation Wing, Ministry of Finance
Step 4–5 — for non-resident and DTAA applications
Evaluates TDS reduction applications from non-residents claiming DTAA benefits, verifies Tax Residency Certificates, and issues lower deduction certificates considering applicable treaty provisions.
File Form 13 application online, upload supporting documents, track application status, and download the approved nil or lower TDS certificate.
A Section 197 certificate is valid only for the specific deductor(s) and the Assessment Year mentioned in it; if you receive payments from a new payer, a fresh application must be filed.
Deductors will only accept reduced TDS if they have received the physical or downloaded copy of the Section 197 certificate; a verbal or email claim is not sufficient.
The certificate is valid only for the Assessment Year specified; a fresh Form 13 application must be filed every year before the start of the financial year to prevent excess TDS.
Apply in April or May; waiting until late in the year means TDS at the full rate is already deducted for multiple months — the certificate can only prevent future deductions, not reverse past ones.
Officers often reject Form 13 applications where there are pending income tax demands; resolve outstanding dues before applying or provide a satisfactory explanation for any pending demand.