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Tds on car hire charges (Income Tax)

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This query is : Resolved


( Author )
08 July 2013

Pls clarify if TDS on car hire charges is to be deducted u/s 194C or 194I.

Thanks.


M.com,CS,CAFinal Tushar Sampat

( Expert )
08 July 2013

IT SHOULD BE DEDUCTED U/S 194I


Hemant Kumar

( Expert )
08 July 2013

Section 194 I.


CMA. CS. Sanjay Gupta

( Expert )
08 July 2013

Both section can be applied depending on the case. For details see below link---

http://www.simpletaxindia.org/2008/08/tds-on-car-rent-taxi-charges.html


Ganeshbabu K

( Expert )
08 July 2013

if car is hired for specific job,..like pick up and drop of staff 194C will be applicable

however if entire control of car was transfer ed means hirer is responsible for maitnainance expences like driver salary,diesel,and repairs...then it is 194I

So 194C or 194I can be ascertained depend on facts of case


M.com,CS,CAFinal Tushar Sampat

( Expert )
09 July 2013

If car is hired for pick upn drop facility then its perquisite to employees,sec 194c doesnt come into picture.



CMA. CS. Sanjay Gupta

( Expert )
09 July 2013

Tushar Ji if car hired for pickup and drop facility its perquisites in the hands of employee but when employer makes payment to car owner it will attract TDS u/s 194C since the car was taken for a specific job and element of contract is there.


Tehmton

( Author )
09 July 2013

Dear All,

Thanks for the responses. In my case the car is being hired for employees for travelling on official travel / tour as when required. There is no fixed schedule. The car is called for as when required.


Ganeshbabu K

( Expert )
09 July 2013

So it is seen as specific agreements and we cannot deduct tds under SEC194I and hence 194C will be applicable..

So TDS 194C WILL BE APPLICABLE

Please note..

If the bill is in the name of company you need to discharge service tax under reverse charge also.

Reverse charge applicable if you are company or LLP and Service Provider should be HUF, Individual, firm.

Thanks & regards
Ganesh babu k


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