18 June 2008
Earlier a bill for Rs 11000/- was booked towards repair and maintenance and tds was not deducted for the same. Now a bill is received fromt he same party for rs 51723/-, in which material purchased is for 33712/- and towards service provided is for 18011/-. Should I deduct tds?
18 June 2008
No..According to 194C if ur Single payment to contractor exceeds Rs.20000 or if the aggregate payments in the year Excceds Rs.50000, then u have deduct TDS..
In ur case as No single payment towards service charges has exceeded Rs.20000 and even aggregate payment has not crossed Rs.50000...u may not deduct TDS as of now...But once the aggregate crossses Rs.50000..u have to deduct on entire payments made during the year..i mean on previous paymnets also....u can recover TDS from any of future payments...
18 June 2008
If the invoice has a separate identifiable line for services and Material ( or separate Invoice for service) then in that case the threshold limit of Rs. 50000 in a financial year is not crossed, hence TDS u/s 194c should not be deducted. if not then better to deduct the tax.
But pl make sure that once the said contractor crosses the 50000 limit then you need to deduct the tax on the entire amount (i.e. retrospectively)
CAclubindia
