Tds on c & fa invoice

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This query is : Resolved

Amit Kondalkar (Querist)

02 July 2014 If we received C&FA [CLEARING & FORWARD AGENT] single invoice for below charges

Agency charges + Service Tax
Other reimbursement Charges – not tax

Then TDS will deduct on full invoice or only on agency charges

Please help

Guest

Guest (Expert)

02 July 2014 tds will be on full charges except the service tax amount

Rupesh Jain

Rupesh Jain (Expert)

02 July 2014 tds wil deducted u/s 194C for agency charges bill.

Amit Kondalkar

Amit Kondalkar (Querist)

02 July 2014 AGREE IT WILL BE CHARGE U/S 194C

SUPPOSE

1st Example

REIMBURSEMENT [SEA FREIGHT/TRANSPORTATION CHGS/STAMP DUTY ETC. AMT]IS 3,00,000
&
AGENCY CHGS/ENDORSEMENT CHGS IS 2500 + ST 309

TOTAL INV AMT : 3,02,809/-

THEN TDS AMT WILL BE Rs.6,050/- [UNDER 194C] OR RS. 50/-

OR

2 EXAMPLE

REIMBURSEMENT [SEA FREIGHT/TRANSPORTATION CHGS/STAMP DUTY ETC. AMT]ARE 40,000-
&
AGENCY CHGS/ENDORSEMENT CHGS IS 4500 + ST 556

TOTAL INV AMT : 45,056/-

THEN TDS AMT WILL BE 890/- [UNDER 194C] OR 90/-

Please Help

Amit Kondalkar

Amit Kondalkar (Querist)

03 July 2014 can anyone help me??

Aashok Kumar Sharma

Aashok Kumar Sharma

(Expert)

27 July 2025 Sure! Let me clarify the TDS calculation for your C\&FA invoice examples.

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### Basic principle:

* **TDS is deducted only on the Agency Charges (service fees) part, excluding Service Tax and reimbursements.**
* **No TDS on reimbursements** (like freight, transportation, stamp duty).
* **No TDS on Service Tax** as it is a tax collected on behalf of the government.

---

### Section:

* TDS on C\&F agency charges falls under **Section 194C** (payment to contractors) generally.
* The applicable rate is **1% or 2%**, depending on the category of the deductee.

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### Your examples:

| Example | Calculation for TDS (assuming 2%) |
| ------------------------ | --------------------------------- |
| **1st Example:** | Agency charges = Rs. 2,500 |
| Reimbursement = 3,00,000 | Service Tax = Rs. 309 |
| Total Invoice = 3,02,809 | TDS = 2% of 2,500 = Rs. 50 |
| | **TDS = Rs. 50** |
| **2nd Example:** | Agency charges = Rs. 4,500 |
| Reimbursement = 40,000 | Service Tax = Rs. 556 |
| Total Invoice = 45,056 | TDS = 2% of 4,500 = Rs. 90 |
| | **TDS = Rs. 90** |

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### Important Notes:

* Use **agency charges amount only**, **excluding service tax** and **excluding reimbursements**.
* Service tax is not subject to TDS.
* Deduct and deposit TDS accordingly.

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If you want, I can help you draft the TDS entry or calculation sheet for multiple invoices!

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