Tax Deducted at Source
This query is : Resolved
Kishan L. Agarwal
(Querist)
15 December 2008
A proprietor gets work done from outside and for different jobs makes payment to different persons. Will the payments be liable to TDS and if so at what rate and will come under which category?
Some of the payees are not having PAN. Will the prop. be able to deduct tax at source?
Some of the payees are not having PAN. Will the prop. be able to deduct tax at source?
CA Tilak Raj Sharma
(Expert)
15 December 2008
If the proprietor is a contractor then he is sub-contracting the work. If he is not a contractor then he is job worker will be treated as contractor. This is covered by section 194C. TDS rates are as below
- For Contractor - 2%(+SC+EC+SHEC)
- For Sub-Contractor - 1%(+SC+EC+SHEC)
You cannot deduct TDS if the payees are not having PAN. You need to impress them to apply for PAN. Because it is your liability to deduct TDS not them. Your expenditure will be disallowed.
- For Contractor - 2%(+SC+EC+SHEC)
- For Sub-Contractor - 1%(+SC+EC+SHEC)
You cannot deduct TDS if the payees are not having PAN. You need to impress them to apply for PAN. Because it is your liability to deduct TDS not them. Your expenditure will be disallowed.
Ravikumar.G
(Expert)
15 December 2008
Further if your turn over not exceeding 40L (i.e not come under 44AB (tax audit) need not deduct TDS.
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