Tds on printing of brochure/handouts/leaflets in pharma co.
This query is : Resolved
26 November 2014
whether there will be tds on the transaction where a pharma co. Is purchasing printing material in form of brochure/handouts/leaflets for advertisement and marketing purpose.
Facts:
Content is decided by the pharma co.
Vendor prints on the papers procured by him independently.
Bill states printing job/box printing etc and also includes vat in it.
Request experts to opine in light of section 194C and circular 715 and 658
Facts:
Content is decided by the pharma co.
Vendor prints on the papers procured by him independently.
Bill states printing job/box printing etc and also includes vat in it.
Request experts to opine in light of section 194C and circular 715 and 658
26 November 2014
yes u r definitely liable for tds u/s 194c
Message likes :
1 times
26 November 2014
Will packing material be also liable for tds then?
26 November 2014
If in the bill packing material shown separately then not liable.
If not shown separately then whole amount of bill liable for tds.
If not shown separately then whole amount of bill liable for tds.
Message likes :
1 times
26 November 2014
Under which clause of sec194C will it be taxed? As the section is ambiguous.
Any idea on pharma industry practice?
Any idea on pharma industry practice?
27 July 2025
Here’s a detailed response regarding **TDS on printing brochures/handouts/leaflets in a pharma company** context, based on the facts and relevant sections:
---
### 1. **Is TDS applicable on printing of brochures/leaflets/handouts?**
* Yes, **TDS is applicable under Section 194C** on payment made for printing jobs.
* This is because printing services generally qualify as a **“work”** under Section 194C (which covers contracts for works including supply of labor, services, and materials).
---
### 2. **Key points from your facts:**
* **Content decided by pharma company**, but printing done by vendor using their own paper.
* Bill states **“printing job” or “box printing”**, including VAT.
* Papers are procured **independently by the vendor** (not provided by pharma co.).
---
### 3. **Application of Section 194C:**
* **Section 194C covers payments to contractors for carrying out any work, including supply of labor for carrying out any work.**
* Printing services are generally treated as works contract for TDS purpose (refer Circular No. 715 and 658).
* If the vendor procures the material (paper) himself and does the printing job, the entire payment is considered a works contract.
* Thus, **TDS is to be deducted on the gross amount (excluding VAT), as printing is a service rendered by the vendor.**
---
### 4. **Packing material & TDS:**
* If **packing material is shown separately on the bill**, TDS is **not applicable on the packing material amount**.
* If packing material is **not shown separately**, then TDS applies on the whole bill amount (excluding VAT).
This is because the **packing material is a supply of goods**, and TDS under Section 194C is not applicable on goods — only on services or works contracts.
---
### 5. **Relevant clauses under Section 194C:**
* The TDS deduction is under Section 194C(1), which mandates TDS on payments made to contractors for carrying out any work (including printing contracts).
* There is no separate clause specifically for printing, but it falls within the broad definition of **“work”** as per the Act and related circulars.
---
### 6. **Industry practice (Pharma):**
* Pharma companies usually deduct TDS under Section 194C on printing and packaging services.
* They exclude VAT while calculating TDS.
* Packing materials, if separately billed, are excluded from TDS.
---
### **Summary Table**
| Parameter | TDS Applicability | Section | TDS Rate (if applicable) |
| ------------------------------ | --------------------------------- | ----------------- | -------------------------------- |
| Printing of brochures/leaflets | Yes (if vendor procures material) | 194C (contractor) | 1% (individual/HUF), 2% (others) |
| Packing material (separate) | No | N/A | N/A |
| VAT on bill | Excluded from TDS calculation | N/A | N/A |
---
If you want, I can help you draft the exact TDS calculation or prepare clarifications for your finance team. Would that be useful?
---
### 1. **Is TDS applicable on printing of brochures/leaflets/handouts?**
* Yes, **TDS is applicable under Section 194C** on payment made for printing jobs.
* This is because printing services generally qualify as a **“work”** under Section 194C (which covers contracts for works including supply of labor, services, and materials).
---
### 2. **Key points from your facts:**
* **Content decided by pharma company**, but printing done by vendor using their own paper.
* Bill states **“printing job” or “box printing”**, including VAT.
* Papers are procured **independently by the vendor** (not provided by pharma co.).
---
### 3. **Application of Section 194C:**
* **Section 194C covers payments to contractors for carrying out any work, including supply of labor for carrying out any work.**
* Printing services are generally treated as works contract for TDS purpose (refer Circular No. 715 and 658).
* If the vendor procures the material (paper) himself and does the printing job, the entire payment is considered a works contract.
* Thus, **TDS is to be deducted on the gross amount (excluding VAT), as printing is a service rendered by the vendor.**
---
### 4. **Packing material & TDS:**
* If **packing material is shown separately on the bill**, TDS is **not applicable on the packing material amount**.
* If packing material is **not shown separately**, then TDS applies on the whole bill amount (excluding VAT).
This is because the **packing material is a supply of goods**, and TDS under Section 194C is not applicable on goods — only on services or works contracts.
---
### 5. **Relevant clauses under Section 194C:**
* The TDS deduction is under Section 194C(1), which mandates TDS on payments made to contractors for carrying out any work (including printing contracts).
* There is no separate clause specifically for printing, but it falls within the broad definition of **“work”** as per the Act and related circulars.
---
### 6. **Industry practice (Pharma):**
* Pharma companies usually deduct TDS under Section 194C on printing and packaging services.
* They exclude VAT while calculating TDS.
* Packing materials, if separately billed, are excluded from TDS.
---
### **Summary Table**
| Parameter | TDS Applicability | Section | TDS Rate (if applicable) |
| ------------------------------ | --------------------------------- | ----------------- | -------------------------------- |
| Printing of brochures/leaflets | Yes (if vendor procures material) | 194C (contractor) | 1% (individual/HUF), 2% (others) |
| Packing material (separate) | No | N/A | N/A |
| VAT on bill | Excluded from TDS calculation | N/A | N/A |
---
If you want, I can help you draft the exact TDS calculation or prepare clarifications for your finance team. Would that be useful?
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
- Applicability of TDS on CFS, CHA fees, and shipping line charges
- Notice from IT DEPTT IF FD AMOUNT EXCEEDS 10 LACS
- Limited Liability Partnership Firm
- Applicablity on tds
- GST payable under RCM
- Unable to generate and save json file for updated return
- PRODUCT AND SERVICE CATEGORY CODE
- Section 194I not showing in TDS RPU for Compnay Assessee for TDS on rent
- LTCG offset against property buy
- Tax audit & Switching from Presumptive taxation
- Advance money given for supply of goods
- Import purchase entry
- Rule 54(1A) for Distributing ITC
- Received advance money for supply of goods but forfeited by us since full money not received
- EXCESS CREDIT REALTED GST REVERSAL
- Export invoice not reported
- CA Articleship Extension Matter
- GST OFFICER WRONG NOTICE
- "Please ensure that the Total of the Deductions u/s 54F match the same in Table D in Sch CG"
- Composition Dealer GST Annual Return Filing process
Trending Online Classes
-
LIVE Course on GSTR-9 & GSTR-9C (Technical | Practical | Concept - Based)
Sachin Jain03 November 2025
CAclubindia
