This query is : Resolved 

01 February 2011

Dear Experts ,

In the Financial Year 2009-10, Our company has deducted @1% Subcontractors TDS and deposited the same amount in govt. account, we have received a show cause notice from Income tax department with demanding @ 2.26%,
Please guide us .

CA Shailesh Kumar Bhagat (Expert)
01 February 2011

Without knowing the full details , It is very difficult to comment on demand notice. I think IT has taken it as direct contract.

CMA. Subhash Kumar Jha (Expert)
01 February 2011

From 01/10/2009, TDS rates for contractors & sub-contractors were made similar. The only differentiation that was made was on the basis of status of the payee.

In case of Individual or HUF deductee (contractor or sub-contractor) : TDS rate is 1 %

So, in case of any other deductee (contractor or sub-contractor) : TDS rate is 2 %

So, most likely this subcontractor is not falling under Individual or HUF category & the rate of 1 % charged by you is not correct w.e.f. 1/10/09.

You need to be the querist or approved CAclub expert to take part in this query .

Click here to login now

Similar Resolved Queries :

× Online Coaching My Enrolled Courses
Articles Forum News Experts Exams Share Files Income Tax Accounts Career Corporate Law Service Tax Video Judgements Rewards Top Members Events Albums Find Friends Featured Feed Scorecard Bookmarks Mock Test Poll Notification Knowledge Finder Coaching Institutes Trainee Corner Jobs
close x