TDS Deduction applicability

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This query is : Resolved

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If your turnover exceeded the limits specified in Section 44AB(a) for the financial year 2018-19, you are likely required to deduct TDS under Section 194A for the financial year 2019-20. This applies even if you filed your return under Section 44AD. It's advisable to err on the side of caution and assume TDS deduction is necessary.

Sunny

Sunny (Querist)
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11 March 2020 I have filed return u/s 44AD for F.Y. 2018-19 declaring profit @6% of turnover and my turnover was 1,10,00,000 (1.10 crore).

For F.Y. 2019-20 do I need to deduct tds u/s 194A?

Am I liable to deduct TDS for F.Y. 2019-20??

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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11 March 2020 Yes, liable to deduct in 2019-20 because turnover in 2018-19 exceeded the limit prescribed in 44AB(a).

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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11 March 2020 From the plain reading if the proviso to sub-section (1) of Section 194A, reference to only monetary limits specified U/s 44AB (a) 44AB (b) suggests that in your case TDS is required to be deducted.
This is safer rather than taking a view that accounts were not required to be audited U/s 44AB(a).

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