Whether tds should be dedudcted or not

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

09 April 2013 Query for proprietor firm
1. Last year 2011-12, our firm was under the audit ie turnover was around 70 lacs . we had deducted tds on contractors as usual.
2. Current year 2012-13 our turnover is around 80 lacs, so i want to know whether we have liability to deduct TDS or not for FY 2012-13 on contractor having a single bill amount rs 115000.
please help as soon as possible due to you all know its already too late.

Querist : Anonymous

Querist : Anonymous (Querist)

25 September 2013 I THINK ALL EXPERTS ARE TOO BUSY......OR SOMETHING ELSE....

Aashok Kumar Sharma

Aashok Kumar Sharma

(Expert)
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03 August 2025 Query Summary:
FY 2011-12: Turnover ~ Rs. 70 lakhs (firm was under audit)

FY 2012-13: Turnover ~ Rs. 80 lakhs

Contractor payment with a single bill of Rs. 1,15,000

Question: Is there a liability to deduct TDS on contractor payment in FY 2012-13?

TDS Deduction on Contractor Payments — Key Points:
Turnover Threshold for Audit & TDS applicability:

For FY 2012-13 (Assessment Year 2013-14), Section 44AB audit limit for proprietorship firm is Rs. 60 lakhs.

Since turnover is Rs. 80 lakhs, audit is applicable.

Being under audit does not directly affect TDS liability but turnover does affect threshold for TDS deduction under section 194C.

TDS under Section 194C (Payment to Contractors):

TDS is to be deducted on payment to contractors if the payment exceeds Rs. 30,000 in a single transaction or Rs. 1,00,000 in aggregate during the financial year.

Since your single bill amount is Rs. 1,15,000, which is above Rs. 30,000 and Rs. 1,00,000 aggregate, TDS deduction is mandatory.

Rate of TDS:

For individual/HUF contractors: 1%

For others (including companies): 2%

Due date for TDS deduction:

TDS must be deducted at the time of payment or credit, whichever is earlier.

Conclusion:
Yes, you have a liability to deduct TDS on the contractor payment of Rs. 1,15,000 in FY 2012-13.

Deduct TDS under Section 194C as per applicable rates.

Since you mentioned it is late, deduct TDS immediately and deposit with the government. Also file TDS returns accordingly to avoid penalties.

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