Tds on printing material

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This discussion clarifies whether Tax Deducted at Source (TDS) applies to purchases of promotional and advertising materials such as brochures, visiting cards, and printed banners. The consensus is that if these items are custom-made with a logo, they are considered contract work under Section 194C, making TDS applicable. TDS rates are 1% for individuals/HUFs and 2% for others, provided the invoice exceeds £30,000 or the annual aggregate exceeds £100,000, as per Circular 715.

CA jignesh daiya

CA jignesh daiya

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29 April 2020 Respected sir
we are in business of promoting goods and services of others by providing discount coupons .
we have purchased broucher, visiting card , templates , advertisement material with our logo , leaflet etc .for advertisement then whether tds will be applicable on that transaction ?
we have also purchased printed star flex and star backlit material from party whether tds on contract will be applicable in both above situation ?
please reply

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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29 April 2020 Yes TDS on contract will be applicable on both above. Deduct 2% TDS.

CA jignesh daiya

CA jignesh daiya

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29 April 2020 in above case
we have purchased material and there was no job work .
then why tds applicable ?
according to my understanding , tds become applicable for job work when material are provided by supplier but we have not provided any material .

please explain

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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29 April 2020 These materials are not purchased off the shelf but made to order with logo so it will fall under contract work.

CA jignesh daiya

CA jignesh daiya

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29 April 2020 RESPECTED SIR
I have refereed one circular in which it was mentioned that no tds will become applicable when we purchase material for advertisement purpose .
i am not remembering that circulars.

please guide for the same

CA jignesh daiya

CA jignesh daiya

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29 April 2020 These materials are not purchased off the shelf but made to order with logo so it will fall under contract work.
where this distinction is made ?

CA jignesh daiya

CA jignesh daiya

(Querist)
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29 April 2020 These materials are not purchased off the shelf but made to order with logo so it will fall under contract work.
where this distinction is made ?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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29 April 2020 TDS needs to be deducted on the mentioned payments. It has been specifically provided in the Circular 715 dated 08.08.1995. See Q. 15 in the following link: https://law.incometaxindia.gov.in/TaxmannDit/DispCitation/ShowCit.aspx?fn=https://law.incometaxindia.gov.in/directtaxlaws/cbdt/dtccontents/PARA1119.htm

KAVIRAJA ADDANGADI

KAVIRAJA ADDANGADI (Expert)
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29 April 2020 Tds need to be deducted u/s 194C , customisation amounts to job work, if it exceeds threshold limit tds applicable.

Aashok Kumar Sharma online

Aashok Kumar Sharma

(Expert)
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08 May 2020 Yes it will fall under 194C - Contracts.

TDS Rates:
TDS @ 1% for Individuals/HUF &
TDS @ 2% for others.

However, in case the PAN is not furnished, the Deductor would be liable to deduct TDS @ 20% i.e. at the maximum marginal rate.

TDS will be deducted if:
1. Single Invoice exceeds Rs. 30,000/-
2. Yearly aggregate exceeds Rs. 100,000/-

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