TDS on Advance for construction of Building

Save Share

This query is : Resolved

Quick Summary

This discussion clarifies whether Tax Deducted at Source (TDS) is applicable when an advance payment is made for the construction of a building. TDS is indeed applicable under Section 194C, with rates of 1% for individuals/HUFs and 2% for others. Additionally, Section 194M may apply to individuals/HUFs not subject to tax audit, requiring a 5% TDS on payments exceeding Rs. 50 lakhs.

Sonnal Khandaray

Sonnal Khandaray (Querist)
Follow

29 July 2021 Hi
Whether TDS is applicable for advance given for construction of building? What will be rate?

Thanks in advance.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
Follow

29 July 2021 Yes, TDS applicable under section 194c @ 2%>

Message likes : 1 times

CA Rajat Pathak

CA Rajat Pathak (Expert)
Follow

30 July 2021 U/s 194C
Individuals/HUF 1%
Others 2%

Message likes : 1 times

CMA Poornima Madhava

CMA Poornima Madhava (Expert)
Follow

30 July 2021 Further, in case of individuals/HUFs not being subject to tax audit, section 194M would apply in which case TDS @5% on exceeding the threshold limit of Rs.50 lacs.

Message likes : 1 times

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now

Join CAclubindia WhatsApp Finance Community & stay updated with the latest TAX news, compliance alerts and important updates all in one place!