TDS deduction by Agencies to Media house/broadcasters for media business payments
This query is : Resolved
02 March 2023
Is 194C applicable on payments to Media houses / Broadcasters like print, television radio etc on the media buying because many media houses like Zee, Star are getting their TDS deducted at source while some media houses like TV 18 denied mentioning agency would not n deduct any TDS at source to the payment for media buying... IN Income Tax its not very much clear so it require your expert views with specific justification in this regard.
03 March 2023
Kindly suggest & reply please as an advertising agency do we deduct TDS at source on bills & payments above threshold limits U/s 194C @ 1%-2% to print, digital & Television/radio broadcasters...????
13 March 2023
CBDT in circular no. 715 dt. 8/8/1995 have clarified that there will be no TDS under section 194C on the payment by an advertising agency to the television channel/ newspaper company.
In case of any further queries, kindly mail me at casoravgupta@gmail.com
Thanks & Regards
CA. Sorav Gupta
(Practicing Chartered Accountant)
In case of any further queries, kindly mail me at casoravgupta@gmail.com
Thanks & Regards
CA. Sorav Gupta
(Practicing Chartered Accountant)
13 March 2023
Thanks Sorav ji but as per other Consultants the said Notification was on 1995 (almost 27 years) after that IT department included almost very services under TDS / TCS. Agencies do not deduct any TDS while on payments they receive the payments after corresponding deductions.. Moreover other TV Channels, Radio Partners, Magazines, Print etc do not object or have issues in their deductions. Even last year also the department notified to take undertakings with the vendors u/s 206AB & 206CCA failing which we should deduct TDS on higher rates. I think if anybody require a relaxation from TDS deduction they should produce No deduction Certificate from department U/s 197...
27 July 2025
Great question! The TDS treatment on payments made by advertising agencies to media houses (like TV channels, newspapers, radio, digital platforms) can indeed be confusing due to evolving rules and mixed practices.
### Here’s a clear summary with reference to your query:
---
### 1. **Section 194C (TDS on Contractual Payments):**
* **Nature:** TDS under **Section 194C** applies on payments to contractors or subcontractors for carrying out any work (including supply of labor).
* **Applicability to media houses:** Generally, media houses are **not contractors** providing labor or work in the usual sense; rather, they are providing **advertising space/time or services**.
* **CBDT Circular No. 715 dated 08/08/1995:**
The CBDT clarified that payments by advertising agencies to television channels or newspapers **do not attract TDS under section 194C** because these are payments for advertisement services, not works contract.
---
### 2. **Section 194J (TDS on Professional or Technical Services):**
* Payments made to media houses for advertisement are often considered **professional or technical services**.
* Hence, **Section 194J (TDS @ 10%)** may be applicable on such payments, subject to threshold limits.
---
### 3. **Current practice & threshold limits:**
* Many media houses (like Zee, Star, etc.) **accept TDS deduction under Section 194J**, typically at 10%.
* Some others (like TV18 as you mentioned) may refuse TDS deduction citing circulars or no contractual liability under 194C, or require no deduction certificate under Section 197.
* **No TDS under 194C** is generally accepted for media buying payments.
---
### 4. **Section 206AB & 206CCA impact:**
* Under these sections, if the payee (media house) has not filed returns or complied with tax rules, higher TDS rates may apply.
* So agencies must take undertakings and verify the status of vendors to apply correct TDS.
---
### 5. **Summary of what applies for media payments by agencies:**
| Type of Payment | Section for TDS | Rate | Applicability on Media Houses/Broadcasters |
| ---------------------- | --------------- | ----- | ----------------------------------------------------- |
| Advertisement Payments | 194J | 10% | Applicable on payments to media houses |
| Contractual Payments | 194C | 1%-2% | Generally **not applicable** on media buying payments |
---
### **Practical advice:**
* Deduct TDS under **Section 194J at 10%** on payments to media houses for ad space/time, subject to thresholds.
* **Do NOT deduct under Section 194C** unless there is a works contract.
* Obtain **Form 16/197 certificate** or declarations where possible.
* Keep track of payee compliance under Sections 206AB & 206CCA.
---
If you want, I can help draft a formal note or sample communication for your agency clients on this, or help with compliance checklists.
Would you like me to?
### Here’s a clear summary with reference to your query:
---
### 1. **Section 194C (TDS on Contractual Payments):**
* **Nature:** TDS under **Section 194C** applies on payments to contractors or subcontractors for carrying out any work (including supply of labor).
* **Applicability to media houses:** Generally, media houses are **not contractors** providing labor or work in the usual sense; rather, they are providing **advertising space/time or services**.
* **CBDT Circular No. 715 dated 08/08/1995:**
The CBDT clarified that payments by advertising agencies to television channels or newspapers **do not attract TDS under section 194C** because these are payments for advertisement services, not works contract.
---
### 2. **Section 194J (TDS on Professional or Technical Services):**
* Payments made to media houses for advertisement are often considered **professional or technical services**.
* Hence, **Section 194J (TDS @ 10%)** may be applicable on such payments, subject to threshold limits.
---
### 3. **Current practice & threshold limits:**
* Many media houses (like Zee, Star, etc.) **accept TDS deduction under Section 194J**, typically at 10%.
* Some others (like TV18 as you mentioned) may refuse TDS deduction citing circulars or no contractual liability under 194C, or require no deduction certificate under Section 197.
* **No TDS under 194C** is generally accepted for media buying payments.
---
### 4. **Section 206AB & 206CCA impact:**
* Under these sections, if the payee (media house) has not filed returns or complied with tax rules, higher TDS rates may apply.
* So agencies must take undertakings and verify the status of vendors to apply correct TDS.
---
### 5. **Summary of what applies for media payments by agencies:**
| Type of Payment | Section for TDS | Rate | Applicability on Media Houses/Broadcasters |
| ---------------------- | --------------- | ----- | ----------------------------------------------------- |
| Advertisement Payments | 194J | 10% | Applicable on payments to media houses |
| Contractual Payments | 194C | 1%-2% | Generally **not applicable** on media buying payments |
---
### **Practical advice:**
* Deduct TDS under **Section 194J at 10%** on payments to media houses for ad space/time, subject to thresholds.
* **Do NOT deduct under Section 194C** unless there is a works contract.
* Obtain **Form 16/197 certificate** or declarations where possible.
* Keep track of payee compliance under Sections 206AB & 206CCA.
---
If you want, I can help draft a formal note or sample communication for your agency clients on this, or help with compliance checklists.
Would you like me to?
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