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TDS

$AcH!n G (Still Running for My Destination) (1036 Points)

07 June 2011

I want to know that whether software purchase from a party, which is liable for vat as well as for service tax as per CBEC notification, payment made to the party against such purchase is subjected to TDS or not or if yes then under which section of TDS. Pls give your valuable advice.

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5 Replies

Dipen Sen (Accounts Officer) (66 Points)
Replied 07 June 2011

Hi Friend,

How come Service Tax & Vat can be levied simultaneously. It is either VAT or Service Tax in one particular bill depending on nature of sales. I mean Vat for Goods Selling & Service Tax for Service selling. As in your query, there is a selling of Capital Goods like Software for which depreciation is charged @ 60% & 40% in Income Tax & Companies Act respectively.Therefore there will be no TDS on Sundry Debtor's part but if it is a selling of Service for example Customised Software preparing under contract or installing Software or imparting trainning on Software then there will be TDS @ appropriate rate under 94J or 94C that too if single or aggregate payment crosses the limit under above sections. I hope I could be able to answer your query properly.

D Sen

$AcH!n G (Still Running for My Destination) (1036 Points)
Replied 07 June 2011

Thanks for your opinion, as i mentioned in my post vat and service tax both are possibe as per CBEC notification. so in that case is it possible to deduct TDS while making payment to supplier.for your information first i purchased the software and then i sell it other's. now in that case what is your opinion.