Courier charges TDS applicable or not

This query is : Resolved

Quick Summary

TDS applies on courier charges under Section 194C at 1 percent if payment exceeds threshold. Deduct TDS on amount excluding GST if shown separately, else on full invoice value.

ARCHANA

ARCHANA (Querist)
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07 September 2023 Sir/Mam,

Our Courier person is proprietor and Registered in GST, we are paying regular monthly courier charges, Our payment crossed Rs. 30,000/-

My doubts courier charges TDS applicable or not , if applicable what is TDS rate

Plz clarify my doubts

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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07 September 2023 TDS applicable under section 194c 1%.

Saurabh Anokhchand Jain

Saurabh Anokhchand Jain (Expert)
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08 September 2023 TDS on courier charges is required to be deducted U/s 194C at a rate of 1% for payments to residents . The TDS should be calculated based on the invoice value, but the treatment of Goods and Services Tax (GST) in the invoice affects the calculation.

If the GST value is mentioned separately in the invoice, TDS should be deducted on the invoice value excluding the GST amount. This is in accordance with Circular No. 23/2017.

However, if the GST value is not mentioned separately in the invoice, TDS should be deducted on the entire invoice value. This guidance is also provided in Circular No. 23/2017.

In summary, whether GST is separately mentioned in the invoice or not determines how TDS is calculated on courier charges under Section 194C of the Income Tax Act, 1961

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