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TDS Rate for Hire of vehicle (Income Tax)

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( Author )
18 July 2009

Please tell the TDS rate applicable for hire charges of vehicle
i) If the vehicle is provided with driver and monthly charges include his allowance
ii) If the agreement is only for providing the vehicle, driver charges are over & above the monthly rent


Ratan Sharma

( Expert )
18 July 2009

1. TDS applicable on whole amount @ 10.3% u/s. 194I
2. TDS is payable on total amount even if the vehicle owner has seprated the charges in agreement as diesel exps, driver salary, maintenance exps, etc. The moot point is that you are paying the rent towards all these expenses hence TDS applicable on total rent. Also the driver is not employed by you and therefore he is not your employee.


CA. BIJENDER KR. BANSAL

( Expert )
18 July 2009

It is contract for providing the vechile on monthly basis.
Tds will be deducted u/s 194 C i.e 2% till 1st oct 2009 .
Onward 1st Oct 2009, if it individul or huf then 1% otherwise 2%


taxindiaconnect

( Expert )
18 July 2009

Agreed with ratan.


B.Chackrapani Warrier

( Expert )
18 July 2009

Seems the view of Mr.Ratan and Mr.Rajesh is appropriate.


CA. BIJENDER KR. BANSAL

( Expert )
18 July 2009

Dear Mr. Ratan,

AS per expllanation III of Section 194 C , work shall also include :
a)
b)
c) Carriage of goods and passenger by any mode of transport other than by railways.

It means section 194C apply to hiring of vechile.
In section 194I, nowhere is provided regarding rent /hiring of vechile , there is only rent of land, building , machinery, plant, equipment, furniture & fittings .

Please give feedback on it.


Pa1

( Author )
20 July 2009

Dear Mr. Bansal

Doesnt the definition of plant include vehicle?


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