The provisions relating to TDS on income earned by non-resident sportsmen, sports associations and entertainers have been restructured under the Income-tax Act, 2025. The earlier Section 194E of the Income-tax Act, 1961 is now covered under Section 393(2) [Table: Sl. No. 1], effective from 1st April, 2026.
This restructuring retains the provisions relating to deduction of tax at source on specified income earned in India by non-residents in the field of sports and entertainment, while aligning the section reference with the updated legislative framework.
Quick Reference – Section Mapping & Reporting
- New Section (IT Act 2025): Section 393(2)
- Table Reference: Table: Sl. No. 1
- Nature of Payment: TDS on Payments to Non-Resident Sportsmen/Entertainers
- Earlier Section (IT Act 1961): Section 194E
- Return Form: 27Q
- Code (for return filing): 1039
Applicability of TDS under Section 194E
TDS is required to be deducted on income earned in India by non-resident sportsmen (including athletes), non-resident sports associations or institutions, and foreign entertainers. Such income may arise from participation in sports events, performances, advertisements, or related contributions in India.
The responsibility to deduct tax lies with any person making such payment, and the provisions apply to the non-resident recipient receiving such income under this section.
Time of Deduction
At the time of payment or credit, whichever is earlier.
Nature of Income
(a) Sportsman / Athlete – Income from:
- Participation in India in any game (other than card games or gambling)
- Advertisement
- Contribution of articles relating to any game or sport in India in newspapers, magazines or journals
(b) Sports Association or Institution – Income from:
- Any amount guaranteed to be paid or payable in relation to any game (other than card games, etc.) or sport played in India
(c) Foreign Citizen Entertainer – Income from:
- Performance in India
Rate of TDS
- 20%
- Plus applicable surcharge and Health & Education Cess @ 4%
Note
No deduction shall be allowed while computing the income referred to above.
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