Commission income

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Pranjali (Querist)
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30 July 2012 My client is in business of supplying labour's,and he receives commission income of 3% on labour income. however, he receives total labour income and commission in his hand, later on he pays the same to labour, but party deducts TDS on 194C on amount including labour income. How much income he should declare and how to get refund of TDS deducted?

RAJESH KUMAR KHANDELWAL

RAJESH KUMAR KHANDELWAL (Expert)
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30 July 2012 Labour Income plus commission shall be his total gross receipts for the purposes of tax audit. He can divide his gross receipts into two part. One part income billed for labour & another is income billed for commission as a service charges. His gross receipts for labour income shall be equal to amount paid for labour charges. He will claim TDS as from 26AS. I am also doing this. I have recently finalize a same case which was under scrutiny for the AY-2010-11.

CA Amit Jaiswal

CA Amit Jaiswal (Expert)
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30 July 2012 Income: Total amount received from the party.

TDS: He can claim the TDS. If his total liability is more/less then the TDS, then he should pay/claim refund for the diference amount.
Don't forget to cross chk the amount of TDS with form 26AS.

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