TDS on payment to visiting doctor: a clinic's guide Who deducts, at what rate, the TAN, the deposit dates and the forms under the 2025 Act.

Yes, in most cases a clinic must deduct TDS when it pays a visiting doctor. If the clinic is run by a company, LLP, partnership firm, trust or society, it deducts 10% from the consultant's fee once the total paid to that doctor in the tax year exceeds ₹50,000, under section 393(1), Table Sl. No. 6(iii) of the Income-tax Act, 2025 (section 194J of the 1961 Act). A clinic owned by an individual doctor deducts at the same 10% only if the owner's professional receipts in the previous tax year exceeded ₹50 lakh. The tax goes to the government by the 7th of the following month, a quarterly statement follows, and the doctor gets a certificate for the credit.

The Income-tax Act, 2025 came into force on 1 April 2026, so payments from that date follow its sections and the forms in the Income-tax Rules, 2026. We give the old 1961 section or form in brackets only where a document we read states it. The consultant's side, claiming the deducted tax and the presumptive scheme, is in our post on income tax for doctors under the 2025 Act.

Does my clinic have to deduct TDS from a visiting consultant's fee?

It depends on who owns the clinic. Section 393(1) says that where a sum in column B of its table "is credited or paid by the person specified in column C during the tax year, to a resident, the person responsible for paying such income or sum shall deduct income-tax". Serial 6(iii) covers "fees for professional services", and the payer in column C is a "specified person". Section 402(28) defines professional services as services rendered "in the course of carrying on legal, medical, engineering or architectural profession" and a few others, so a consultant's fee for seeing patients is inside the row.

Section 402(37) then defines a specified person as "(a) any person, not being an individual or Hindu undivided family; or (b) an individual or a Hindu undivided family, whose total sales, gross receipts or turnover from the business or profession carried on by him exceed one crore rupees in case of business or fifty lakh rupees in case of profession during the tax year immediately preceding the tax year in which such income or sum is credited or paid". Every clinic run as a company, LLP, firm, trust or society is therefore a specified person from day one. An individual doctor-owner becomes one only on the strength of last year's receipts.

The 2% row, Serial 6(ii), has a threshold of "Fifty lakh rupees", which a small doctor-owned OPD rarely pays one consultant in a year. The exemption in section 393(4), Table Sl. No. 9 for fees paid "exclusively for personal purposes" does not cover a clinic's consultant fee.

The test for a doctor-owner looks back one year

Because section 402(37)(b) looks at "the tax year immediately preceding", a doctor-owner checks last year's gross professional receipts every April. If the clinic's receipts for tax year 2026-27 cross ₹50 lakh, the owner becomes a specified person for payments made in 2027-28 and must deduct at 10% from the first visiting consultant whose fees cross ₹50,000 that year. Count every professional receipt in that figure, including fees the owner earns at a hospital, because the definition speaks of receipts "from the business or profession carried on by him".

How do the ₹50,000 threshold and the 10% rate work in practice?

Section 393(1) tells the payer to deduct "(a) on the entire amount of such income or sum, where the amount or aggregate of amounts exceeds the threshold limit specified in column D", "(b) at the rate specified in column D" and "(c) at the time of credit of such income or sum to the account of the payee or at the time of its payment in cash or by way of a cheque or a draft or by any other mode, whichever is earlier". Two practical points follow.

1. The ₹50,000 is counted per consultant across the tax year (1 April to 31 March), not per bill. A specialist paid ₹15,000 a month crosses it in the fourth month.
2. Once the aggregate crosses ₹50,000, the words "on the entire amount" mean tax is due on the whole aggregate, not only on the excess. Ask your CA how to catch up the months already paid without deduction.

If you already know a consultant will cross ₹50,000 in the year, ask your CA whether to start deducting from the first payment. Either way, the doctor must give a valid PAN. Section 397(2)(a) requires every person entitled to receive an amount on which tax is deductible to furnish "his valid Permanent Account Number", and if they do not, section 397(2)(b)(i) sets the deduction at the higher of the row rate, the rates in force, or "20% in any other case".

A consultant can also apply under section 395(1) for a lower or nil deduction certificate; once issued, the payer "shall deduct the tax at the rate specified in such certificate, or deduct no income-tax, as the case may be, till its validity". Keep a copy with the month's TDS papers.

What do I need: TAN, deposit dates, quarterly return and certificate?

Section 397 sets the duties and the Income-tax Rules, 2026 (Notification No. 22/2026, G.S.R. 198(E), 20 March 2026) set the forms and dates. For a clinic deducting under Sl. No. 6(iii), the cycle is the one below.

The individual doctor-owner who falls under the 2% row has a lighter path. Section 397(1)(c) says the TAN requirement does not apply to a person deducting under Sl. No. 6(ii). Rule 218(3) asks such a payer to deposit "within a period of thirty days from the end of the month in which the deduction is made" with a challan-cum-statement in Form No. 141 (the old Forms 26QB to 26QE), and rule 215 gives the doctor a certificate in Form No. 132 within fifteen days of that form's due date.

What happens if the clinic does not deduct or pays late?

The consequences fall on the clinic, not on the doctor, and they stack.

One relief exists. Under section 398(2) the clinic is not deemed in default if the consultant filed a return, included the fee and paid the tax, and the clinic "furnishes a certificate to this effect from an accountant"; interest at 1% still runs to the date of that return (section 398(3)(c)).

Is the visiting doctor's payment salary or a professional fee?

It depends on the contract and how the relationship works, not on the label on the payment voucher. If the doctor is an employee, the clinic deducts under section 392(1) at the average rate on estimated salary, files the quarterly salary statement in Form No. 138 (old Form 24Q) and issues Form No. 130 (old Form 16) by 15 June after the year. If the doctor is an independent professional, Sl. No. 6(iii) applies as above.

The leading line of cases comes from the Bombay High Court. In The Commissioner of Income Tax (TDS-1), Mumbai v. Asian Heart Institute and Research Centre Pvt. Ltd. (Income Tax Appeal No. 676 of 2018, order of 5 March 2019), the revenue argued that payments to full-time consultant doctors were salary under section 192, not fees under section 194J. The court dismissed the appeal. Quoting its earlier decision in CIT v. Grant Medical Foundation (375 ITR 049), it said the contract "would have to be read as a whole", and that fixed hours at the hospital do not by themselves make a doctor an employee: "merely because they are required to spend certain fixed time at the hospital, treating fixed number of patients at the hospital, attend them as out patients and Indoor patients does not mean that a employer-employee relationship can be culled out or inferred."

Contractual tenure of these doctors was for a period of one year which would be renewable depending on the performance of the doctor ... These doctors are not entitled to benefits of leave encashment, gratuity, provident fund, superannuation benefits etc. which regular employees of the hospital are. These doctors would on their own obtain indemnity insurance. These are clear indications that the relationship was not one of employer-employee.

For doctors on "a fixed pay and tenure", Grant Medical Foundation records that "Even the assessee accepts the position that they are the employees". The orders were decided under the 1961 Act; sections 392 and 393 keep the same split, so treat the factors below as indicators read together, not a checklist.

How does TDS work on a revenue-share arrangement?

In a typical arrangement the clinic collects the fee from the patient at the front desk, keeps its share for the room, the staff and the queue, and pays the rest to the consultant. The Asian Heart order describes exactly this: "15% of the fee collected by the doctors would be deducted by the hospital as its share and the balance 85% would be paid to the doctors after deduction of tax at source", and "In case of fees not being paid by patients, the same would be the liability of the concerned doctors." The court held that relationship was not employment.

1. The TDS is on the amount the clinic credits or pays to the consultant, their share, not on the full fee the patient paid. In a 70:30 split of a ₹1,000 fee, the consultant's credit is ₹700.
2. The ₹50,000 threshold is tested on the consultant's share added up across the year.
3. Record each patient's fee and the split on the day; the per-doctor total decides when the threshold is crossed.
4. If the arrangement runs the other way, with the patient paying the doctor and the doctor paying the clinic for the room, the clinic is no longer paying a professional fee. A different row of the TDS table may then apply to the doctor as the payer of rent. Ask your CA.

GST is a separate question. CBIC Circular No. 32/06/2018-GST says "Services provided by senior doctors/ consultants/ technicians hired by the hospitals, whether employees or not, are healthcare services which are exempt"; our post on GST on doctor consultation fees covers it.

Doctor-partners in a firm

If the doctor is a partner in the firm that runs the clinic, the payment is not a consultant fee. Section 393(3), Table Sl. No. 7 has the firm deduct 10% on "salary, remuneration, commission, bonus or interest paid to a partner" above ₹20,000 a year.

What should the visiting consultant expect from the clinic?

Section 390(5) treats tax deducted and paid as "payment of tax on behalf of the person ... from whose income such tax has been deducted". The consultant counts the gross fee as receipts and claims the TDS as credit, which reaches them only through your deposit and quarterly statement. A late or wrong statement leaves the doctor without it until you correct it.

A monthly TDS routine for a small clinic

1. On the first working day of each month, list every visiting consultant paid or credited last month, with the gross share, the PAN and the running total for the year.
2. For each consultant above ₹50,000 for the year (or certain to cross it), compute 10% of the month's credit, plus any catch-up the CA advises.
3. Pay the total by challan with the clinic's TAN by the 7th. For March, the date is 30 April.
4. After each quarter, give the CA the three months' list and challans for Form 140, due 31 July, 31 October, 31 January and 31 May.
5. Within fifteen days of each Form 140 due date, download Form 131 from the Department's portal and send it to each consultant.
6. Every April, check whether the owner's professional receipts for the year just ended crossed ₹50 lakh. If the clinic is owned by an individual, that decides the rate for the new year.

The month's consultant totals come straight out of the day's collections, so the daily close of cash, UPI and card is where this routine starts.