TDS on Architect

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If you've contracted an architect for office renovation work that includes materials, you'll need to deduct TDS. This is because it's considered a contract for work and labour under Section 194C of the Income Tax Act. The TDS rate is 1% if the payment is made to an individual or HUF, and 2% for any other entity.

Aryan

Aryan (Querist)

30 March 2023 Dear Expert,

We have given contract to an architect for renovation work of office with material, how much TDS will be deducted on his bill, can we consider him as contractor?

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)

30 March 2023 If the contract is for renovation work with material, yes you can.

CA Sanat Pyne

CA Sanat Pyne (Expert)

30 March 2023 As per the provisions of the Income Tax Act, 1961, any person making payment to a contractor for carrying out any work, including the supply of labor and material, is required to deduct tax at source (TDS) at the applicable rates.
In your case, since you have given a contract to an architect for renovation work of your office with material, it can be considered as a contract for work and labor. Therefore, you are required to deduct TDS on the payment made to the architect.
As per section 194C tax is to be deducted as follows:
• @ 1% when the contract payment is being made or credit is being given to an individual or an HUF.
• @ 2% when the contract payment is being made or credit is being given to any person other than an individual or an HUF.
Therefore, in your case, you are required to deduct TDS at the rate of 1% or 2%, as applicable, on the payment made to the architect for renovation work of your office with material.

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