§ 396
Chapter XIX — Collection And Recovery Of Tax
Tax deducted is income received
Income-tax Act, 2025
For tax calculation, any amount deducted under this Chapter is treated as income received by the assessee.
However, this does not apply to persons who must deduct tax under section 393(1), persons specified in section 393(4), or those notified by the Central Government.
Foreign tax paid that qualifies for a credit is also excluded, except tax covered by section 392(2)(a) or tax deducted under section 393(3).
📜 Official text of the section +
396. The following sums shall be deemed as income received for the purposes of
computing the income of an assessee—
( a) sums deducted under this Chapter; and
92. Substituted by the Finance Act, 2026, w.e.f. 1-10-2026. Prior to its substitution, clause ( c)
read as under :
“( c) the provisions of clause (a) shall not apply—
( i) to a person who is required to deduct tax under provisions of section 393(1) [Table:
Sl. Nos. 2(i), 3(i) and 6(ii)];
( ii) to a person referred to in section 393(4) [Table: Sl. No. 12.C(a)]; and
( iii) a person notified in this regard by the Central Government.”
( b) income-tax paid outside India by way of deduction in respect of which
an assessee is allowed a credit against the tax payable under this Act,
except tax paid under section 392(2)(a) and tax deducted as per section 393(3)
(Table: Sl. No. 5).
Compliance and reporting.
Plain-language summary — not the official text. Refer to the bare Act and confirm with a professional for your specific case.