Tds on commision

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CHETAN (Querist)
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01 December 2008 Hi,
I am working in company.our company is taking a service from a firm on refunds of Duty drawback.This firm has charded their fees by 0.75% of the refunds of drawback + service tax(12.36%).I want to know that on which rate we have to deduct TDS.currently we are duducting by 2.266%(194C).pls suggest me On which rate i should deduct TDS and why?

Ram Avtar Singh

Ram Avtar Singh (Expert)
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01 December 2008 on commition under section 194H tds 10.30% should be dedut.

K V Subba Rao

K V Subba Rao (Expert)
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01 December 2008 Obviously rate of TDS depends on nature of work. So you take a clear view on this depending on actual details of service which you must be aware of.

To be on safe side, propose recovery u/s 194-H (10%) instead of u/s 194-C (2%). Then the firm will come out with copies of Bills showing TDS deductions for similar work, if made by other Companies u/s 194-C.

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