payment to payroll outsourcing agency

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darpan chheda (Querist)
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17 September 2010 Recently our company has decided to outsource the payroll function to an agency . Now under the agreeement, we are required to pay the following charges to the agency in relation to the work

- Data migration &processing fees 15000(INR)
- Sub-code generation 500(INR) per location

- Salary & Payslip processing 24(INR) per employee per month

- Web developing & other reports 3000(INR) per man day

Now the question is, under which section the above transation is subject to TDS...? Sec 194 C or 194 J. Please explain giving reasons

Await your replies eagarly..

Thanks in advance

CMA. Subhash Kumar Jha

CMA. Subhash Kumar Jha (Expert)
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17 September 2010 In my opinion , TDS will apply under section 194J.

CMA. Subhash Kumar Jha

CMA. Subhash Kumar Jha (Expert)
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17 September 2010 The reason : Its not a simple contractual payment , instead its a payment for providing a service, which itself is technical in nature.

darpan chheda

darpan chheda (Querist)
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17 September 2010 Thanks a lot sir for the reply.

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