TDS on Transporter

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

03 December 2009 I have read lot of discussion about TDS on Transport Contrat.
Please suggest me at what rate the Transport Contractor will deduct TDS of Truck owner from whom they have hired truck.
In case of Transportation of goods by road. The transport contractor is the person issuing the Goods Receipt(GR Bilti) he may or may not own trucks. They hire the truck from the truck owner.
Now my question is at what rate will the Contractor deduct TDS of Truck Owner or still 15I will be applicable.

Murtaza I Bhagat

Murtaza I Bhagat (Expert)
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04 December 2009 TDS applies only when Transportation Payment given by the Company/Party... it doesn't matter who is the owner of the Truck... TDS Certificate will have to issue on the name of Transport. (whatever Owner or Hirer)

Querist : Anonymous

Querist : Anonymous (Querist)

06 December 2009 Thank u,
but still i am unable to find my answer.
I am asking at wht rate transport contractor will deduct TDS of truck owner from whom they hire the truck.

Aashok Kumar Sharma online

Aashok Kumar Sharma online

(Expert)
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27 July 2025 Got it! Here's a clear explanation for your question:

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### Situation:

* **Transport contractor** hires trucks from **truck owners** (they don’t own trucks themselves).
* The contractor pays the truck owners for hiring trucks.
* You want to know: **At what rate should the transport contractor deduct TDS from the truck owner?**

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### Answer:

1. **Who deducts TDS?**
The transport contractor is making a payment to the truck owner for hiring trucks. So the **contractor** is responsible for deducting TDS on such payments to the truck owner.

2. **Which section applies?**
The payment to truck owner for supply of trucks/services is considered a contract payment for transportation services, so **Section 194C** of the Income Tax Act applies here.

3. **What is the TDS rate?**

* For **individual or HUF** truck owners:
TDS @ **1%** on the payment amount.

* For **other entities (like companies or firms)**:
TDS @ **2%** on the payment amount.

4. **PAN availability:**

* If the truck owner provides PAN, TDS is deducted at above rates.
* If PAN is **not provided**, TDS is deducted at **20%** (penal rate).

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### Summary table for TDS on truck owners by transport contractors:

| Truck Owner Type | TDS Rate (Section 194C) |
| ---------------- | ----------------------- |
| Individual/HUF | 1% |
| Company/Firm | 2% |
| No PAN Provided | 20% (penal rate) |

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### Additional points:

* The transport contractor should issue TDS certificates in the name of the truck owner (the deductee).
* The deductor (contractor) must deposit TDS and file TDS returns accordingly.

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If you want, I can also share references from the Income Tax Act or CBDT circulars confirming this.

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**Does this clear your doubt?** Or want me to explain any part in more detail?

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