Online platforms like Zomato and Swiggy have become a significant source of income for many restaurants and delivery partners in India. However, many of these partners are surprised to find that a portion of their earnings has been deducted as TDS (Tax Deducted at Source). As per income tax rules, these companies must deduct a small amount of tax before paying you.
But here is the good news: if your total income is below the taxable limit, you can claim that money back as a refund from the Income Tax Department
This blog will walk you through what TDS is, the rate applicable on TDS, and steps to claim your TDS refund from Zomato or Swiggy for the Financial Year 2024–25 (Assessment Year 2025-26).
What is TDS?
Tax Deducted at Source (TDS) is a mechanism where the payer (Zomato or Swiggy in this case) deducts a certain percentage of income as tax before making the payment to you. This deducted amount is deposited with the government on your behalf and can be adjusted against your final income tax liability.
Why do Zomato and Swiggy Deduct TDS?
- Section 194-O of the Income Tax Act, 1961, was introduced by the Finance Act, 2020, and came into effect from 1st October 2020. The purpose of this section is to bring e-commerce participants, such as restaurants, delivery partners, and other vendors, within the TDS (Tax Deducted at Source).
- Zomato and Swiggy, being e-commerce operators, are required to deduct TDS on the gross amount payable to restaurants and delivery partners for goods sold or services provided through their platform.
Who Needs to Claim a TDS Refund?
You should claim a refund if:
- You are a delivery partner or restaurant whose total annual income is below the taxable limit (₹5,00,000 for individuals under 60 as per FY 2024–25).
- Your total tax liability is less than the TDS already deducted.
- The deducted amount appears in your Form 26AS or AIS under your PAN.
How Much TDS is Deducted?
- As per Budget 2024, effective from 01.10.2024, the TDS rate under Section 194-O has been reduced from 1% to 0.1% of the gross amount of sales or services.
- If PAN is not furnished or not linked with Aadhar, a higher TDS rate of 5% is applicable under Section 206AA of the Income Tax Act, 1961.
- As per CBDT Circular No. 20/2023, the TDS under Section 194-O is to be calculated on the gross amount payable. This includes:
- Base value of the goods or services,
- Platform or convenience fees,
- Delivery charges,
- Packaging fees,
- Commissions and any additional charges.
Step-by-Step Guide to Claim TDS Refund from Zomato and Swiggy
Step 1: Check Form 26AS or AIS for TDS Credit
Before you can claim a refund, verify that the TDS deducted is properly recorded against your PAN:
How to Check Form 26AS:
- Visit https://www.incometax.gov.in.
- Log in using your PAN and password.
- Go to e-File → Income Tax Returns → View Form 26AS.
- Download the latest Form 26AS and check under Part A for TDS deductions from Zomato or Swiggy (you will see their TANs and amounts listed).
Alternatively, Use AIS (Annual Information Statement):
- This is a broader record of your financial data and includes TDS, bank interest, and other transactions.
- Navigate to Services → AIS to download and review the AIS for the same assessment year.
Step 2: Collect Your TDS Certificate (Form 16A)
Zomato and Swiggy issue Form 16A on a quarterly basis, which includes:
- Their TAN
- Your PAN
- Amount of TDS deducted
- Quarter of deduction
You can obtain Form 16A via:
- The partner dashboard (Zomato Partner App or Swiggy Restaurant Partner Portal)
- Requesting it directly from the respective platform’s support team
Tip: Keep Form 16A for each quarter for accurate reconciliation.
Step 3: Calculate Your Total Tax Liability
Use the total income earned during the financial year to estimate your tax liability.
Scenarios:
- If your total income is below the basic exemption limit, your tax liability is zero, and you can claim a full TDS refund.
- If your tax liability is less than the TDS deducted, you will get the difference as a refund.
Example:
If your total income is ₹2,80,000 and Zomato deducted ₹3,000 as TDS, your tax liability is ₹0. You can claim the entire ₹3,000 as a refund.
Step 4: File Your Income Tax Return (ITR)
To claim a TDS refund, filing your ITR is mandatory even if your income is below the taxable limit.
Which ITR Form Should You Use?
- ITR-1 (Sahaj): For individuals with income from salary, pension, or interest (not business).
- ITR-4 (Sugam): For freelancers, gig workers, or anyone earning from a business or profession under presumptive taxation.
Tip: If you are a delivery partner or restaurant owner with multiple sources of income, ITR-4 is most suitable.
How to File:
- Go to https://www.incometax.gov.in.
- Log in and navigate to e-File → Income Tax Return → File Now.
- Choose the correct ITR form.
- Enter all income details and TDS under the ‘Taxes Paid’ section.
- Confirm TDS details match your Form 26AS and Form 16A.
- Submit the return and complete e-verification using Aadhaar OTP, net banking, or other approved methods.
Step 5: Track Your Refund Status
After filing and verifying your return:
- Log in to the Income Tax portal.
- Go to e-File → Income Tax Returns → View Filed Returns.
- Check refund status for the applicable Assessment Year (AY 2025–26).
- Refund status will show one of the following:
-
- Refund Issued
- Refund Under Process
- Refund Failed
- Refund Adjusted Against Demand
The refund, if due, is usually processed within 2 to 8 weeks, and the amount is credited directly to your PAN-linked bank account.
Common Mistakes to Avoid
- Failing to Check Form 26AS or AIS
- Incorrect PAN Details
- Skipping TDS Certificates (Form 16A)
- Using the Wrong ITR Form: Filing ITR-1 instead of ITR-4
- Not Declaring Full Income while claiming TDS
- Entering Incorrect TDS Amounts in ITR
- Forgetting to E-Verify Your Return
- PAN and Aadhar Card not linked
- Not Keeping Backup Documents such as invoices, Form 16A, or TDS
- Waiting Until Last Minute to File the Income Tax Return
Can You Claim a Refund Through a Tax Consultant?
Yes. Several platforms, including TaxBuddy and ClaimMyTDS, offer specialized services specifically designed for gig workers and freelancers. However, if you’re comfortable navigating the income tax portal, you can file your return and claim your refund yourself at zero cost.
Conclusion
While Zomato and Swiggy are required by law to deduct TDS, you are equally entitled to claim it back if your tax liability is nil or lower than the TDS. The key lies in tracking your deductions through Form 26AS, collecting your Form 16A, and filing an income tax return (ITR) on time. By following the steps in this guide, you can recover your hard-earned money without hassle and stay compliant with tax regulations.
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