Tds query for service tax bill

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Hardik (Querist)
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30 June 2015 Dear Sir,

Do we need to deduct TDS on the basic amount of bill or on total amount of bill including service tax?
If yes, does it applicable to all section or some specific section (i.e. 194I & 194J)? Pls help.

CA Neelam Maheshwari

CA Neelam Maheshwari (Expert)
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30 June 2015 TDS is to be deducted on the amount exclusive of service tax if the service tax amount is shown separately.
EARLIER, TDS was to be deducted on all payments inclusive of service tax except Rent. However, this rule is changed now.

Hardik

Hardik (Querist)
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30 June 2015 Thanks for this update, however also let me know whether this is applicable to all sections or some specfic section i.e. 194I & 194J?

CA Neelam Maheshwari

CA Neelam Maheshwari (Expert)
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30 June 2015 YES.. this is applicable to all sections provided service tax amount is shown separately.

Hardik

Hardik (Querist)
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30 June 2015 Thanks for the information....

CMA. CS. Sanjay Gupta

CMA. CS. Sanjay Gupta (Expert)
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30 June 2015 TDS to be deducted on amount excluding service tax for all sections.

The CBDT has issued Circular No. 1/2014 dated 13.01.2014 pointing out that the Rajasthan High Court has taken the view in CIT(TDS) vs. Rajashthan Urban Infrastructure that if as per the terms of the agreement between the payer and the payee, the amount of service-tax is to be paid separately and was not included in the fees for professional services or technical services, no TDS is required to be made on the service-tax component u/s 194J of the Act. Pursuant thereto, the CBDT has decided in exercise of powers u/s 119 that wherever the terms of the agreement/ contract between the payer and the payee, the service tax component comprised in the amount is indicated separately, tax shall be deducted at source under Chapter XVII-B of the Act on the amount paid/payable without including such service tax component. Details of notification may be seen from below link--

https://www.eicbma.com/circulars/Cir-01-2014-130114.pdf

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