Treatment of GST for TDS/TCS on purchase/sale of goods



Quick Summary
This article clarifies the treatment of Goods and Services Tax (GST) when deducting Tax Deducted at Source (TDS) on goods purchases under Section 194Q and collecting Tax Collected at Source (TCS) on goods sales under Section 206C(1H). It explains how your accounting method (inclusive or exclusive of GST) affects turnover thresholds and the calculation of the Rs. 50 lakh limit per party. The article also details when GST should be included or excluded for TDS/TCS calculations based on CBDT circulars.

Arjuna (Fictional Character): Krishna, Section 194Q for TDS deduction on the purchase of goods has become effective from 1.7.2021, whereas TCS collection on sale of goods is already applicable from last year from 1.10.2020, but there is confusion regarding the treatment of GST amount while applying
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Name: - UMESH RAMNARAYAN SHARMA. Residential Address: - 16, Motisagar, Samarthnagar, Aurangabad. Ph :- 2332846. Mobile:9822079900. Head Office Address: - R.B.Sharma Co. Chartered Accountants. Block No 7-10, 2nd Floor, Shangri-La Complex, Samarth Nagar, Aurangabad. Ph :- 2332511,2338388. Email:- rbsha ... Read more

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