Tax deduction

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Meenu Agarwal

Meenu Agarwal (Querist)
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02 July 2012 Can tax be deducted on purchase of Fixed assets? Does it require any type of contract with the vendor?

CA CS Amit S. Kedia

CA CS Amit S. Kedia (Expert)
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02 July 2012 Tax is not deducted on purchase of fixed assets except software.

Meenu Agarwal

Meenu Agarwal (Querist)
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02 July 2012 And, if a company has a contract with a vendor then whether the co. should deduct tax @2%.

CA RICHA BADALIA

CA RICHA BADALIA (Expert)
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02 July 2012 As such no TDS is deducted on purchase of fixed asset.But if you have contract with vendor and you are paying labour charges for the same then TDS is deducted u/s 194 C on it ,if the limit is exceeded.

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Meenu Agarwal

Meenu Agarwal (Querist)
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02 July 2012 Whether the labour charges will include the delivery charges?

CA CS Amit S. Kedia

CA CS Amit S. Kedia (Expert)
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03 July 2012 Certainly not..
Generally Labour charges at the time of purchasing the fixed assets form part of fixed assets.
It is included in the cost of the Fixed assets and TDS will not be deducte on any of the amount and entire amount is debited to the cost of the fixed assets.

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