TDS deduction from contractors supplying Employees

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MAYANK PAREKH (Querist)

10 August 2008 freinds,

Kindly reply on my query relating to -

1. Is TDS to be deducted on the bill of contractor supplying employees?

2. If TDS is to be deducted, than does this TDS is inclusive of Service-tax Amount in the bill?

3. Also, consider that Both the contractor and contractee are Corporates and the total contract value entered is exceeding Rs.20,000/-.

Ram Avtar Singh

Ram Avtar Singh (Expert)

10 August 2008 TDS to be deducted under sec 194C
If cotractor is under any contract lincence then no service tax to be liable if he is supplying only labour and there is no cantrct then service tax to liable.

MAYANK PAREKH

MAYANK PAREKH (Querist)

10 August 2008 Sir,

Please elaborate me what kind of licence to be verified from such contractor.

Also, if such contractor's bill is like-
Basic= Rs. 81/-*26 days=
2106= (a)Basic(Rs. 81/-x26 days p.month)
421 = (b)HRA(20% of a)
270 = (c)Others(12.8% of a)
150 = (d)Washing Allowance(Fixed p.m)
263 = (e)PF(12.5% of a)
140 = (f)ESIC(4.75% of a)
150 = (g)Uniform Charges(fixed p.m)
3500= (h)Total
280 = (i)Services Charges(8% of h)
3780= (j)Total(H+I)
467 = (k)Service-tax(12.36% of J)
.....
4247= (l)Total bill
--> Is Service tax amount charged to the company is valid i.e. Rs.467 is payable??

--> Is Tds to be deducted on the same by the company and at what rate?? if yes, than on gross bill including service-tax or excluding service-tax??

--> Also, if my company is not the employer of the employees employed through the contractor, does the payments of employer contribution towards PF and ESIC to be bourne by the company?? But, the same was agreed on the contract.

Kindly,reply the same at your earliest

Ram Avtar Singh

Ram Avtar Singh (Expert)

11 August 2008 Your Detail showing Its a Labour Supplier not a Contractor.

onely of one & two labour you are taking
service tax to liable
tds after sevice tax to be deduted 2.06%

further u shoul take others openion
thanks

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