Tds provision exemption

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This query is : Resolved

YOGESH (Querist)

06 October 2013 Is assesse exempt from TDS provision in 1st year of business, if yes then under which section it is covered? plz help me out in solving my doubt..

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)

06 October 2013 A sole proprietor or an individual is supposed to deduct tax under sections 194A, 194C and 194J if his books of account are required to be audited under section 44AB in the immediately preceding financial year.

So no TDS is required to be deducted in First year of Business by Individual /HUF as there is no preceding year and books of account are not required to be audited under section 44AB in immediately preceding year

YOGESH

YOGESH (Querist)

06 October 2013 If sec 44AB is applicable then he wil nt get exemption?

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)

06 October 2013 yes. incase sec.44AB applies, they will not get exemption. sec.44AB will apply based on turnover, since the first year of business, sec,44AB cannot calculate starting itself, so first year they can get exemption

CA Pallav Singhania

CA Pallav Singhania (Expert)

06 October 2013 Individual Or HUF has to deduct TDS if his Gross Receipts Exceeds the monetary limits specified under clause (a) or clause (b) of section 44AB during the financial year immediately preceding the financial year in which such income by way of rent is credited or paid, shall be liable to deduct income-tax under this section.

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