Tds and tcs compliances

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ARUN GUPTA (Querist)
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28 October 2021 We purchased from a party in year 2020-2021 and they collected tcs from us as our purchase was more then 50 lakhs. Now in year 2021-22 they are telling me to deduct tds on payments. Will my seller have to collect Tcs and I have to deduct tds both at a time. Please clarify?

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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28 October 2021 No. Only buyer has to collect TDS u/s. 194Q of IT act..

ARUN GUPTA

ARUN GUPTA (Querist)
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28 October 2021 My turn over is less then 10 crores in py 2020-21.So am I liable to collect tds?

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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28 October 2021 No.
Any person, being a buyer whose total sales/gross receipts/turnover from the business carried on by him exceed 10 crore rupees during the F.Y. immediately preceding the F.Y. in which the purchase of goods is carried out, and who is responsible for paying any sum to any resident (i.e. seller) for purchase of any goods of the value or aggregate of such value exceeding fifty lakhs rupees in any previous year, is liable to deduct TDS u/s. 194Q of IT act..

ARUN GUPTA

ARUN GUPTA (Querist)
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28 October 2021 So in my case my sale is below Rs10 crores during py 2020-21 so I am not liable to deduct tds during 2021-2022? Please clarify?

ARUN GUPTA

ARUN GUPTA (Querist)
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28 October 2021 It means tcs is not applicable now

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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28 October 2021 It means TDS u/s. 194Q not applicable in your case; but that doesn't mean TCS not collectible by seller..
When TDS not eligible, seller will collect TCS as usual.

ARUN GUPTA

ARUN GUPTA (Querist)
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28 October 2021 for purchase of any goods of the value or aggregate of such value exceeding fifty lakhs rupees in any previous year, is liable to deduct TDS u/s. 194Q of IT act..

What does here in any previous year relates to?

ARUN GUPTA

ARUN GUPTA (Querist)
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ARUN GUPTA

ARUN GUPTA (Querist)
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28 October 2021 Our to is less then 10 crores in py 2020-21 but we have purchased more than Rs50 lakhs from a single party in py 2020-2021.so are we liable to deduct tds in fy 2021-2022.Please clarify?

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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28 October 2021 In short it is Financial year, in which the TDS is liable to be deducted. (Technically, it is previous year to corresponding Assessment year, for which the transaction will get assessed).
As the TDS section 194Q is applicable to FY 2021-22; it is Previous Year to AY 2022-23..

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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28 October 2021 As your turnover was less than 10Cr. in FY 2021-21, which is immediately preceding year to current financial year, You are not defined as 'buyer' for liability of sec. 194Q...

Read the Explanation given in the section ...
Explanation.—" For the purposes of this sub-section, "buyer" means a person whose total sales, gross receipts or turnover from the business carried on by him exceed ten crore rupees during the financial year immediately preceding the financial year in which the purchase of goods is carried out, not being a person, as the Central Government may, by notification in the Official Gazette, specify for this purpose, subject to such conditions as may be specified therein."

Kowsalya

Kowsalya (Expert)
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02 November 2021 tds will be required to be deducted only when the turnover for the previous yeari.e., (2020-21 in your case) exceeds 10 crores and it is the primary applicable criteria for the requirement of deduction of TDS u/s 194Q.

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