income-tax

Equalization Levy: Digital Ads Tax

Equalization levy @6% on digital ads payments to foreign companies. Who pays and compliance.

GetYourCA Team
1 April 2026·Updated 1 April 20261 min read12.5K views
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Equalization Levy#

What is it?#

  • 6% tax on digital ads
  • Payments to foreign entities
  • Section 165 of IT Act

Who Should Deduct?#

  • Indian resident
  • Making payment for:
    • Online advertising
    • Digital content
    • Platform services

Rate & Threshold#

Payment TypeRateThreshold
Digital Ads6%₹1,00,000/annum

Compliance#

  1. TDS @6% on payment
  2. Deposit by 7th
  3. Certificate to non-resident
  4. Quarterly return

Points to Remember#

  • Not credit to deductor
  • Cannot claim as expense
  • Separate from TDS

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Disclaimer

We have taken utmost care to research and write this article for your information. However, tax laws are complex and subject to frequent changes. This article is for general guidance only and should not be considered professional advice. Individual circumstances vary significantly — what works for one person may not apply to another.

Before making any tax-related decisions, we strongly recommend consulting with a qualified Chartered Accountant or tax professional who can assess your specific situation. We do not accept any liability for decisions made based on this information.

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