rate of contractor

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rajeev khulbe

rajeev khulbe (Querist)
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31 July 2010 sir plz tell me the latest rate of contractor for individual and other
thanks in advance
regards
rajiv

CA Kapil B Gupta

CA Kapil B Gupta (Expert)
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31 July 2010 Your query is not clear, are you asking for TDS rates or others, please clerify.

Taranjit Singh

Taranjit Singh (Expert)
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31 July 2010 Individual or HUF need not deduct tax if the contract is exclusively for personal purposes.

Income Tax should be deducted at the time of payment or credit to the account of the contractor whichever is earlier.

Income Tax is to be deducted at source @ 1% if the contractor/sub contractor payee is an individual or HUF. Payment of amounts to persons other than Individual/HUF would attract TDS rate of 2%.

Provisions of Section 194C are applicable only where the contract is either a “contract for carrying out any work” or a “contract for supply of labour for works contract”. Hence, these provisions are not applicable for payments made under the contract of sale of goods.

Taranjit Singh

Taranjit Singh (Expert)
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31 July 2010 No deduction of tax at source shall be made under this section in the following circumstances:

1. If the amount paid/payable or credited/likely to be credited to the contractor/sub-contractor does not exceed Rs.30,000/- in a single instance (Applicable from 1.7.2010. previously it was Rs.20,000). However, the total of amounts paid or credited during the financial year should not exceed Rs.75,000/-. If the said amount exceeds Rs.75,000/-, then, the liability for payment arises on the whole of amount paid or credited and not on the amount in excess of Rs.75,000/-.( The limit of Rs.75,000 is applicable from 1.7.2010. Previously it was Rs.50,000)
2. In the case of a sub-contractor who is a resident individual and who owns not more than two goods carriages during the previous year, no tax shall be deducted at source during the course of business of plying, hiring or leasing goods carriages if he provides a declaration to the person responsible for payment to that effect in the prescribed form. [Form 15-I]

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