TDS u/s 194Q Applicability

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Vipul Acharya (Querist)

04 August 2021 I have paid my vendor Rs. 92 Lakhs from Apl to Jul-21 out of which 55 Lakhs paid against last year outstanding and the balance against the purchases made in current year.

Total purchases made from him in current year is Rs. 37 Lakhs

Is TDS u/s 194q applicable ? if applicable at which amount and also share rules or guidelines

Regards
Vipul Acharya

Deepa B

Deepa B (Expert)

04 August 2021 Only purchases initiated from 1.4.2021 will be counted for calculating threshold of Rs.50 lacs. In the given case purchase from 1.4.2021 is still Rs.37 lacs. Hence you need not deduct TDS. Because Rs.55 lacs paid during FY 2021-22 is not considered for the said purpose; reason being it is consideration pertaining to transactions of previous financial year. But once the purchases(including advance payments received, if any) exceeds the threshold of Rs.50 lacs in FY 21-22, you have to deduct TDS on the amount in excess of Rs.50 lacs.
For more information on this refer CBDT circular 13/2021 dated 30.6.2021
https://www.incometaxindia.gov.in/communications/circular/circular_13_2021.pdf

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