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TDS on mail hoisting services from Indian company

This query is : Resolved 
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(Querist)
25 January 2024 Sir/Madam - What will be tds rate for Mail Hoisting Services provided by Indian company.
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Aashok Kumar Sharma online

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Aashok Kumar Sharma online (Expert)
11 July 2024 The TDS (Tax Deducted at Source) rate applicable to payments made to an Indian company for Mail Hosting Services would generally be 2% under Section 194C of the Income Tax Act, 1961. This section deals with payments to contractors and sub-contractors for services rendered.

Here’s a breakdown of the TDS rate and section:

- **Section 194C**: This section covers payments to contractors and sub-contractors for work contracts including services rendered.
- **TDS Rate**: For payments made to resident contractors (which would include Indian companies), the TDS rate is 2% if the payee has furnished their PAN (Permanent Account Number) to the deductor (the payer).

Therefore, if an Indian company is providing Mail Hosting Services and payments exceed the threshold limits specified under the Income Tax Act (currently ₹30,000 for single payments and ₹1,00,000 aggregate in a financial year), TDS would need to be deducted at a rate of 2% before making the payment to the service provider.
Profile Image

Aashok Kumar Sharma online

Profile Image

Aashok Kumar Sharma online (Expert)
11 July 2024 The TDS (Tax Deducted at Source) rate applicable to payments made to an Indian company for Mail Hosting Services would generally be 2% under Section 194C of the Income Tax Act, 1961. This section deals with payments to contractors and sub-contractors for services rendered.

Here’s a breakdown of the TDS rate and section:

- **Section 194C**: This section covers payments to contractors and sub-contractors for work contracts including services rendered.
- **TDS Rate**: For payments made to resident contractors (which would include Indian companies), the TDS rate is 2% if the payee has furnished their PAN (Permanent Account Number) to the deductor (the payer).

Therefore, if an Indian company is providing Mail Hosting Services and payments exceed the threshold limits specified under the Income Tax Act (currently ₹30,000 for single payments and ₹1,00,000 aggregate in a financial year), TDS would need to be deducted at a rate of 2% before making the payment to the service provider.
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