Regarding TDS u/s 194Q for goods purchased
This query is : Resolved
05 February 2024
Respected Sir/Madam
Is TDS deducted u/s 194Q on Capital goods purchased? Normally as per goods we consider only goods we manufacture or resale not capital goods we capitalized in business?? So should we deduct on capex?? Kindly advice
Is TDS deducted u/s 194Q on Capital goods purchased? Normally as per goods we consider only goods we manufacture or resale not capital goods we capitalized in business?? So should we deduct on capex?? Kindly advice
05 February 2024
Yes, Sec 194Q also applicable for purchase of CAPITAL GOODS.
17 August 2025
A few more important nuances to note:
The ₹50 lakh threshold is calculated excluding GST. So, GST components do not count toward the limit.
Equentis
If the seller does not provide PAN, the TDS rate increases sharply to 5% instead of 0.1%.
Microsoft Support
Swipe
Section 194Q applies only to purchases from resident sellers—imports or non-resident transactions are excluded.
database.taxsutra.com
If TDS is already being deducted under another provision, 194Q doesn’t apply. And where both 194Q and TCS (Section 206C(1H)) appear to apply, 194Q takes precedence—the seller need not collect TCS.
database.taxsutra.com
suvit.io
Capital goods are also covered—TDS applies if thresholds are crossed even on machinery or equipment purchases.
The ₹50 lakh threshold is calculated excluding GST. So, GST components do not count toward the limit.
Equentis
If the seller does not provide PAN, the TDS rate increases sharply to 5% instead of 0.1%.
Microsoft Support
Swipe
Section 194Q applies only to purchases from resident sellers—imports or non-resident transactions are excluded.
database.taxsutra.com
If TDS is already being deducted under another provision, 194Q doesn’t apply. And where both 194Q and TCS (Section 206C(1H)) appear to apply, 194Q takes precedence—the seller need not collect TCS.
database.taxsutra.com
suvit.io
Capital goods are also covered—TDS applies if thresholds are crossed even on machinery or equipment purchases.
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