Tds on cash payment

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This query is : Resolved

Saswati Das (Querist)

07 August 2019 Please let know if freight of 1500/- can be paid from petty cash without TDS deduction. what if the vendor is already registered with us but there is another branch which can only provide cash memo.

will there be any TDS deduction for such small cash payments? How does the industry practice? as practically its not possible in sites to deduct pennies & send transport the material.

Amol S Joglekar

Amol S Joglekar (Expert)

13 February 2020 TDS not to be done for such small payments.

Amol S Joglekar

Amol S Joglekar (Expert)

13 February 2020 Section 194C of the Income Tax Act, 1961 states that any payment to a transporter is subject to a Tax Deduction at Source (TDS) at the rate of:
1% in case if the payee is an Individual or a Hindu Undivided Family, and
2% in case of other payees (i.e. partnership firm, company, trust, body of individuals or association of persons)
In case, if such payment exceeds Rs. 30,000 per contract or aggregate of such payments of contracts in a financial year exceeds Rs. 100,000.

Amol S Joglekar

Amol S Joglekar (Expert)

13 February 2020 Non-deduction of tax will be available for the small transporters owning not more than 10 goods carriages

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