Content authored by practitioners with experience at Amazon India, Intuit QuickBooks, and the Tata Group. Meet the team →
Restaurant aggregators like Zomato and Swiggy now deduct 1% TDS under Section 393 of the Income Tax Act 2025 with payment code 1010, replacing the legacy Section 194O regime, but settlement files cross the FY 2025-26 to FY 2026-27 era boundary with mixed old-code and new-code deductions that must reconcile to two separate annual statements — final Form 26AS for the legacy period and Form 168 for the new regime.
Pull the aggregator settlement file with order-level gross sale value, classify each deduction by deduction date — pre-April 2026 to legacy 194O, post-April 2026 to Section 393 code 1010 — accrue TDS receivable on gross order value not net payout, post each deduction to the matching tax-period sub-ledger, and reconcile against Form 168 for FY 2026-27 with deductor TAN as the matching key.
Aggregator settlement file connector with order-level gross value extraction; cross-era TDS classifier keyed to deduction date; payment code 1010 mapper for Section 393 entries; Form 168 download integration with TAN-based matching; legacy Form 26AS connector for residual 194O credits; refund-period reversal logic to adjust original TDS base when orders are refunded across settlement cycles.
A reconciled TDS receivable ledger where every Section 393 deduction in the aggregator settlement file ties back to a Form 168 entry under payment code 1010, every legacy 194O deduction reconciles to final Form 26AS, and the cross-era split is auditable at the order-line level for the restaurant's quarterly advance tax computation.
A 12-outlet QSR chain reviewing FY 2026-27 quarterly tax filings finds that its TDS receivable from Zomato has split into two ledgers overnight. The April 2026 settlement file shows deductions tagged under a new section reference and a new payment code; the closing March 2026 file still uses the old code. The annual tax statement on the income tax portal looks different too — Form 168 has replaced Form 26AS. This article is for restaurant finance teams reconciling aggregator TDS deductions in the first full year of the Income Tax Act 2025 regime.
What Section 393 Restaurant Aggregator Reconciliation Involves
Section 393 of the Income Tax Act 2025 is the new statutory home for the 1% TDS that e-commerce operators deduct on the gross value of sales facilitated through their platforms. From April 1, 2026, it replaces Section 194O of the Income Tax Act 1961 for restaurant aggregators including Zomato, Swiggy, and the smaller platforms. The substantive obligation is broadly carried over: 1% deduction on gross order value, deposited under the deductor’s TAN, reflected in the deductee’s annual tax statement.
What changes is the plumbing. The deduction is now deposited via challan ITNS 281 under payment code 1010, the dedicated code for e-commerce operator deductions. The annual statement that captures the credit is Form 168, which replaces the legacy Form 26AS. Aggregators have rebuilt their quarterly TDS return mappings, and restaurant finance teams must mirror that change in the receivable ledger.
For full context on the new payment code structure, see TDS payment codes 1001 to 1092 under the Income Tax Act 2025. For the broader Section 393 framework, see Section 393 TDS reconciliation under the new Income Tax Act.
How Section 393 Applies to Restaurant Aggregator Payouts
The 1% Rate and the Gross-Value Base
Section 393 retains the 1% rate. The base is the gross amount of sale of goods or services facilitated through the e-commerce platform — the order value the customer paid, including the GST component charged by the restaurant on the underlying supply, before the aggregator deducts its commission. The base excludes platform-borne discounts and coupons absorbed by the aggregator.
The most common reconciliation break is finance teams accruing TDS on the net payout — order value minus commission — instead of the gross order value. The aggregator deducts on gross; the restaurant must accrue on gross. Booking only the net under-records the receivable and misses a credit at the time of advance tax computation.
Challan ITNS 281 with Payment Code 1010
Aggregators deposit Section 393 TDS using challan ITNS 281 with payment code 1010. The challan carries the deductor’s TAN, the assessment year, the section reference (393), and the rupee figure. The deposit must be made by the 7th of the following month. The aggregator files its quarterly TDS return (Form 26Q under the new regime) which carries the deductee-wise breakdown and propagates to each restaurant’s Form 168.
Form 168 — The New Annual Tax Statement
Form 168 has replaced Form 26AS for the FY 2026-27 statement onward. It carries the same conceptual structure — deductor-wise, section-wise, period-wise breakdown of TDS credited to the deductee’s PAN — with the new code structure (1010 for e-commerce, etc.). Restaurants verify their aggregator credits by downloading Form 168 from the income tax e-filing portal and matching the TAN-level deduction figures against their settlement-file accrual ledger.
Cross-Era Handling: 194O Credits Trickling Into Form 168
The transition is the messy part. Deductions made on or before March 31, 2026 fall under legacy Section 194O and old payment codes. Deductions from April 1, 2026 onward fall under Section 393 with code 1010. But aggregator settlement cycles cross the era boundary:
- An order placed on March 30, 2026 may settle on April 4, 2026 — and the aggregator’s TDS deposit may use the new code if its tax engine cuts over by deposit date rather than transaction date.
- A March 28 order with TDS deducted under 194O lands in the final FY 2025-26 Form 26AS, not Form 168.
- A refund processed in May 2026 against an original sale in February 2026 reverses TDS that was originally deducted under 194O — and the aggregator may file the reversal under the new return format.
Restaurant reconciliation must therefore maintain a dual ledger for one financial year: legacy 194O receivables verified against final Form 26AS, and Section 393 receivables verified against Form 168. The order-level cross-era split is auditable only if the settlement file ingestion captures both deduction date and section reference for every line.
Section 393 Restaurant Aggregator Reconciliation Reference
| Deduction Element | Pre-April 2026 | Post-April 2026 |
|---|---|---|
| Statutory section | Section 194O, Income Tax Act 1961 | Section 393, Income Tax Act 2025 |
| Payment code on ITNS 281 | Legacy 194O code | 1010 |
| Annual statement | Form 26AS | Form 168 |
| Quarterly return | Form 26Q (legacy schema) | Form 26Q (new schema) |
| Rate | 1% | 1% |
| Base | Gross order value | Gross order value |
The Three Recurring Reconciliation Gaps
Timing gaps dominate the first three months of FY 2026-27. Aggregator deposits land on the 7th of the following month and propagate to Form 168 only after the quarterly return is filed. A March-end deduction may not reflect in Form 168 until the second week of August.
PAN mismatches affect multi-outlet chains where the aggregator-side PAN differs from the bank-account-holder PAN. The TDS credits to the aggregator-registered PAN, which may not be the entity that books the revenue. Reconciliation requires aligning aggregator dashboard PAN with the books-of-accounts PAN before the first cycle of FY 2026-27 closes.
Refund-period crossovers reduce the original TDS base when orders are cancelled or refunded in a later cycle. The aggregator files a revised TDS return covering the reversal, but the revised filing may lag the refund settlement by 30 to 60 days. The restaurant must hold the original receivable open until the revised Form 168 entry confirms the reduction.
Finance teams running payment gateway reconciliation workflows usually extend the same machinery to aggregator settlements, because the deduction stack is comparable in density. Reconciliation software India handles the order-level file ingestion, the cross-era classifier for FY 2026-27, and the payment code 1010 mapping in a single pipeline. The Income Tax India e-filing portal is where the Income Tax Act 2025 text and the Section 393 payment-code lists are published, and where Form 168 is generated for each deductee PAN. For peer cluster context, see Zomato restaurant settlement reconciliation and Swiggy restaurant settlement reconciliation. The restaurant reconciliation India pillar covers the umbrella framework.
For the restaurant chain industry surface, see the Restaurant Chains industry guide. For the buying-intent surface covering this rail, see the restaurant reconciliation software for India overview, and for a head-to-head against the aggregator-side reconciliation tool category, see TransactIG vs Cointab.
The questions below address the most common Section 393 aggregator reconciliation issues raised by Indian restaurant finance teams in the first full year of the new regime.