194 c rate 1 % or 2%

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We hv to make a freight payment to one of our vendor.

he is claiming the payment in his proprietor concern name ( say XYZ), with his personal PAN No. on the invoice.

Chq is going to be issued on his concern name  (XYZ) do we need to deduct tds @ 2% or 1%.

He says 1% is applicable..

pl . help me.

 

 

Replies (10)

Rates of TDS

The rates of TDS for making payment to contractors or sub-contractors for A.Y. 2013-14 are given below:

  • If payment make to individuals/HUF – 1% (SC-NIL, EC & SHEC-NIL)
  • If payment make to other person – 2% (SC-NIL, EC & SHEC-NIL)

 

He's right...

Yes, Your concern Party is correct!

TDS to be deducted at 1%

Just because the Sole prioprietor is running under a Enterprise name, he cannot be categorised as a firm.  He is still an Individual by Income tax act, 1961.

 

Hence, he is charged at 1% of TDS....

Dear All,

We should not dedcut the TDS on freight/Transportation Charges as per income tax act if the Transporer provide PAN copy if not then we sould deduct 20% TDS

Thank you all for your clarification. its clear for me now...

Yes, if the transporter hasPAN then no tds
no tds if transporter have pan
There is no need of TDS if transporter have pan
 
 
 
 


 

though we may not be required to deduct TDS on payments to transporter, there is no harm in doing so if the transporter is himself asking for deduction.  It helps in better compliance all around.

With Pan card 1%,With out Pan card 2% 

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