TDS Deduction Troubleshooting
Why TDS Is Higher for Some Delivery Riders
- ⚖ 1% Normal Rate
- ⚠ 20% Inoperative PAN
- 🔗 PAN-Aadhaar Link
- 💰 100% Refundable
Written and reviewed by CA Sagar Batra
1% vs 20% Snapshot
1% Normal (Sec 194-C)
- PAN operative & Aadhaar linked
- ₹1,000 TDS on ₹1,00,000 payout
20% Higher Deduction
- Unlinked PAN / Wrong PAN on app
- ₹20,000 TDS on ₹1,00,000 payout
Two riders finish the same number of orders in a week. They earn nearly the same. But when payday comes, one loses far more from every payout than the other. If that's you, the question stings: why is my TDS so much higher than my friend's? Did I do something wrong?
Here's the reassuring truth. A higher cut almost always points to a fixable record problem, not a permanent loss. Your money isn't gone. It's parked under your PAN, and most of it is refundable once you sort out the cause.
In this guide, you'll learn the normal TDS rate for riders versus the higher rate, the three main reasons your cut jumps up, simple steps to fix each cause, and how to claim back any extra TDS that's already been deducted. Want the full money-back picture first? Start with our complete guide on TDS refund and ITR filing for food delivery riders. Now let's understand why TDS is higher for delivery riders.
Normal vs Higher TDS: What Rate Should You Actually See?
Knowing the normal rate helps you spot instantly when something's wrong. So let's start there.
Delivery work is deducted under Section 194-C at just 1%. On ₹1,00,000 of payouts, that's only ₹1,000 in TDS. Small, expected, and easy to get back at filing time.
Now here's where it hurts. When your PAN isn't valid or isn't linked, the rate can jump to 20%. On that same ₹1,00,000, that's ₹20,000 gone. Twenty times more from the exact same earnings.
| Situation | TDS Rate | TDS on ₹1,00,000 Payout |
|---|---|---|
| PAN valid + Aadhaar linked | 1% (Section 194-C) | ₹1,000 |
| PAN missing, wrong, or inoperative | 20% (Higher Rate) | ₹20,000 |
Top Causes of Higher TDS for Riders
Almost every case of higher TDS traces back to one of these three causes. Read through them and see which one fits you:
1. Your PAN and Aadhaar Aren't Linked
When your PAN isn't linked to your Aadhaar, it becomes "inoperative." And an inoperative PAN attracts the full 20% rate. Many riders never got around to linking the two. The platform then has no choice but to deduct more. If your PAN is inoperative, this is almost certainly your reason. A PAN Aadhaar mismatch is the single most common cause we see.
Quick checkpoint: Log in to the income tax portal and check whether your PAN status shows as "operative."
2. Your PAN Is Wrong or Missing on the Platform
If you gave a mistyped PAN, or never submitted one at all, the platform must deduct at 20%. There's no way around it on their end. This often happens during quick app onboarding, when details get typed in a hurry. One wrong digit is enough.
Quick checkpoint: Open your rider profile in the app and confirm the exact PAN they have on file.
3. You Were Put in the Wrong Category
Sometimes deductions get processed under the wrong section or head, which changes the rate. This is less common, but it's worth ruling out if your PAN checks out fine.
Quick checkpoint: Confirm the section code reads 194-C in your records. If it shows something else, that's your clue.
Myth vs Reality: Is Higher TDS Money You've Lost?
Let me tackle the biggest fear head-on, because it keeps a lot of riders up at night.
✖ Common Myth
- "A higher cut means the platform or government kept my money for good."
✔ Legal Reality
- Higher TDS is still parked under your PAN, and it is 100% refundable if your income is below the taxable limit.
Here's what this means for you. The higher deduction is a cash-flow problem right now, not a permanent loss. You're short on money today, yes, but that money is sitting safely in your name. Fixing the cause stops future over-deduction, and filing your return gets the past extra back.
Want to see exactly how much is being held in your name? Our guide on how to check Form 26AS and AIS for delivery riders shows you where to look. Every rupee deducted, at 1% or 20%, appears there against your PAN.
How to Fix Each Cause (Step-by-Step)
Match your cause to the fix below and work through it in order. Most riders clear this up faster than they expect.
Fix 1: Link Your PAN and Aadhaar
- Log in to the official Income Tax e-filing portal.
- Go to the Link Aadhaar section under Quick Links.
- Enter your PAN and Aadhaar numbers, and pay any applicable fee if overdue.
- Wait for confirmation that your PAN status changes to Operative.
Fix 2: Correct Your PAN With the Platform
- Check the PAN the app has on record in your profile or documents section.
- Update it with your correct PAN number.
- Ask the platform support team to reflect the correction in their next quarterly TDS return.
Checkpoint: Confirm the corrected PAN appears against your entries in Form 26AS. Raise this early because platform corrections take time.
Fix 3: Flag a Wrong Category in AIS
- Open your AIS on the income tax portal.
- Find the entry with the wrong section or abnormal deduction amount.
- Use the built-in feedback option to flag it as incorrect.
Checkpoint: Keep your payout statements handy as proof. If your TDS is missing entirely, check our guide on what to do if TDS is not showing for delivery riders.
What to Do If Extra TDS Was Already Deducted
Fixing the cause stops it from happening again. But you still want the past extra back, right? Good news: you can get it all back.
Here's the refund path in plain terms:
- All the TDS deducted, even the higher 20% amount, sits under your PAN in Form 26AS and AIS.
- When you file your ITR, your real tax is calculated on your actual net income.
- If too much was deducted, the entire difference comes back to you as a bank refund.
Read that again. A higher cut can actually mean a bigger refund waiting for you! That ₹30,000 comes straight back because your income was below the limit and you owed nothing. One important tip: fix the record first, confirm every rupee shows correctly in your statements, then file.
Quick Recap Before You File
Let's tie it all together. Normal TDS for riders is 1% under Section 194-C. A higher cut is usually 20%, and the cause is nearly always a PAN or linking issue, not a mistake you can't undo.
Your action plan is short:
- Fix the cause (Link PAN-Aadhaar or update app PAN).
- Confirm your corrected records in Form 26AS and AIS.
- File your ITR to claim the extra money back.
And remember the part that matters most: none of that higher TDS is lost if your income is below the limit. It's your money, and it's coming back to you. Learn how to claim your TDS refund online.
Frequently Asked Questions
Why is my TDS higher than other delivery riders?
Almost always because of a PAN issue. If your PAN and Aadhaar aren't linked, or the platform has a wrong PAN on file, you get deducted at 20% instead of the normal 1%. Fix the record and future deductions drop back down.
What is the normal TDS rate for Swiggy and Zomato riders?
It's 1% under Section 194-C. On ₹1,00,000 of payouts, that's ₹1,000 in TDS.
Why is 20% TDS being deducted from my payouts?
The 20% rate kicks in when your PAN is missing, wrong, or inoperative. An unlinked PAN and Aadhaar is the most common trigger for this higher deduction.
Does an unlinked PAN and Aadhaar cause higher TDS?
Yes. An unlinked PAN becomes 'inoperative,' and inoperative PANs attract the 20% rate. Linking them makes your PAN operative again.
Can I get back the extra TDS that was deducted?
Yes. All the deducted TDS sits under your PAN. When you file your ITR and your income is below the taxable limit, the extra comes back as a refund.
How do I fix a wrong PAN on the delivery app?
Check the PAN in your rider profile, update it with the correct one, and ask the platform to reflect the change in their next TDS return.
Will linking my PAN and Aadhaar lower my future TDS?
Yes. Once your PAN is operative, platforms deduct at the normal 1% rate again instead of 20%.
Is higher TDS money I've permanently lost?
No. It's a cash-flow problem now, not a permanent loss. The money is parked under your PAN and is refundable if your income is below the limit.
Stop Overpaying and Claim Your Extra TDS Back
A higher cut today shouldn't mean a smaller wallet forever. Fix the cause once, then claim every extra rupee back in your refund. Here's how to make it simple:
- Download the Easy Return app and check your TDS across all platforms in one place for free.
- Let expert CAs confirm your records and PAN status before you file.
- File your rider ITR for just ₹199 + GST and get your refund credited straight to your bank.
Don't let a 20% cut drain your earnings a day longer than it has to. Claim your TDS refund online today and get back every rupee you've earned!
Disclaimer: This article provides general information regarding tax procedures for gig workers and delivery partners. Tax laws, deduction rates, and filing requirements are subject to updates. Please consult a qualified tax professional for personalized assistance.
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