Tds on dyeing charges
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
29 January 2015
Sir,
I am a manufacturer of readymade garments in which i have to dye fabrics and yarn.
i want to know on which TDS is applicable or not and what % of TDS in which section.
Thanking you
I am a manufacturer of readymade garments in which i have to dye fabrics and yarn.
i want to know on which TDS is applicable or not and what % of TDS in which section.
Thanking you
29 January 2015
if you urself purchasing and doing the work then no tds is applicable.
Querist : Anonymous
Querist :
Anonymous
(Querist)
29 January 2015
Sir,
i only purchase grey fabrics or yarn and dyeing work done by outsider.
pls tell me what % of TDS applicable and in which section.
Thanking you
i only purchase grey fabrics or yarn and dyeing work done by outsider.
pls tell me what % of TDS applicable and in which section.
Thanking you
27 July 2025
If you are a manufacturer of readymade garments and are **outsourcing the dyeing work** to a third party, the TDS implications will depend on the nature of the payment you are making to the third party (the contractor providing dyeing services).
### **TDS on Dyeing Charges:**
Since you are **outsourcing the dyeing work** (which is essentially a **contract for services**), the TDS will apply under **Section 194C**, which is related to **contracts for work** (including work involving manufacturing, processing, or modification of goods).
### **TDS Applicability:**
* **Section 194C** is applicable on payments made to contractors for the **execution of work**. Since dyeing work is essentially a service and involves **processing the fabric**, this section would apply.
### **Rate of TDS:**
* **For individual/HUF**: The TDS rate is **1%** (if the payee is an individual or HUF).
* **For other entities (e.g., companies)**: The TDS rate is **2%** (if the payee is a company or other non-individual entity).
### **TDS Deduction:**
* You must **deduct TDS** from the payment you make to the third-party vendor for dyeing charges, provided the payment amount exceeds the threshold for TDS deduction (₹30,000 in a financial year).
### **When to Deduct TDS:**
* TDS should be deducted at the time of **payment** or **credit** to the contractor’s account, whichever is earlier.
### **No TDS in the Following Cases:**
* **If the payment is below ₹30,000** in a financial year to the contractor.
* **If the contractor is exempt** from TDS under any other specific provisions (e.g., some small businesses or startups).
### **Example:**
If you are paying **₹50,000** for dyeing services to a contractor, the TDS will be:
* **TDS at 1%** (for an individual or HUF) = ₹500.
* **TDS at 2%** (for other entities like a company) = ₹1,000.
You would deduct the applicable TDS and remit it to the government, and issue a TDS certificate (Form 16A) to the contractor for the TDS deducted.
### **Conclusion:**
* **TDS is applicable under Section 194C** for dyeing charges paid to the contractor.
* The **TDS rate is 1%** if the contractor is an individual/HUF and **2%** if the contractor is a company or other entity.
* **TDS should be deducted** if the payment exceeds ₹30,000 in a financial year.
Let me know if you need any further clarification or help!
### **TDS on Dyeing Charges:**
Since you are **outsourcing the dyeing work** (which is essentially a **contract for services**), the TDS will apply under **Section 194C**, which is related to **contracts for work** (including work involving manufacturing, processing, or modification of goods).
### **TDS Applicability:**
* **Section 194C** is applicable on payments made to contractors for the **execution of work**. Since dyeing work is essentially a service and involves **processing the fabric**, this section would apply.
### **Rate of TDS:**
* **For individual/HUF**: The TDS rate is **1%** (if the payee is an individual or HUF).
* **For other entities (e.g., companies)**: The TDS rate is **2%** (if the payee is a company or other non-individual entity).
### **TDS Deduction:**
* You must **deduct TDS** from the payment you make to the third-party vendor for dyeing charges, provided the payment amount exceeds the threshold for TDS deduction (₹30,000 in a financial year).
### **When to Deduct TDS:**
* TDS should be deducted at the time of **payment** or **credit** to the contractor’s account, whichever is earlier.
### **No TDS in the Following Cases:**
* **If the payment is below ₹30,000** in a financial year to the contractor.
* **If the contractor is exempt** from TDS under any other specific provisions (e.g., some small businesses or startups).
### **Example:**
If you are paying **₹50,000** for dyeing services to a contractor, the TDS will be:
* **TDS at 1%** (for an individual or HUF) = ₹500.
* **TDS at 2%** (for other entities like a company) = ₹1,000.
You would deduct the applicable TDS and remit it to the government, and issue a TDS certificate (Form 16A) to the contractor for the TDS deducted.
### **Conclusion:**
* **TDS is applicable under Section 194C** for dyeing charges paid to the contractor.
* The **TDS rate is 1%** if the contractor is an individual/HUF and **2%** if the contractor is a company or other entity.
* **TDS should be deducted** if the payment exceeds ₹30,000 in a financial year.
Let me know if you need any further clarification or help!
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Depreciation Chart Companies Act
- GST Audit whether Govt Companies are exempt?
- PTRC Show Cause Notice on Email
- Capital Gail Exemption Certificate
- Accounting treatment of AMC alongwith the purchase of Laptop
- Unable to File TDS Q2 Return – New TRACES Portal Error
- Transfer of Physical Stock Between Two Proprietorship Concerns
- MSME disclosure and disallowance
- EPF ECR NEW RULES Sep 17th 2026
- Not ordinarily resident having partnership income in India and salary in USA is any form to filed be
- GST Treatment of Purchases with GST Paid where Outward Supplies of Manufactured CattleFeed Exempt
- Expert Help Required for TDS Refund 100000 Through TRACES – AY 2022–23
- IMPORT PURCHASE ENTRY PASSED IN BOOKS OF ACCOUNT
- FAST DS 26 Undisclosed Foreign Asset Disclosure Scheme 2026
- Regime change
- Goods sold but invoice not issued
- Tally: Imported bank entries do not show up in manual reconciliation
- Sales of goods of amount Rs97 lakhs to a party
- Confused About My Career After 12th — Cyber Security, AI or Finance? Need Guidance
- FAST-DS 2026 Under Tax Law - No recourse or support for person declaring via this scheme?
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
