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194C TDS ON CONTRACTOR

Shahan (accountant) (202 Points)

22 February 2025

DEAR SIR,

sir hamne 15300 freight pay kiya hai aur pure year mein 1 lack ke above ja raha kya hum tds deduction ke liable hai.

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Rama chary Rachakonda (Master in Accounts & high court Advocate) (8626 Points)
Replied 22 February 2025

TDS deduction ki liability ka faisla karne ke liye, humein kuch factors ko consider karna hoga: TDS Deduction Rules 1. *Section 194C*: TDS deduction on transportation contracts, including freight payments. 2. *Threshold Limit*: ₹1,00,000 per financial year. Calculation 1. *Total Freight Payment*: ₹1,53,000 (above the threshold limit) 2. *TDS Rate*: 1% or 2% (depending on the type of vehicle and payment nature) Liability 1. *Yes*, you are liable to deduct TDS on the freight payment, as the total payment exceeds the threshold limit of ₹1,00,000. 2. *TDS Amount*: Calculate the TDS amount based on the applicable rate (1% or 2%) and the total freight payment. Action Items 1. *Obtain PAN*: Ensure you have the PAN of the transporter or the person receiving the freight payment. 2. *Deduct TDS*: Deduct the calculated TDS amount from the freight payment. 3. *Deposit TDS*: Deposit the deducted TDS amount to the government within the specified due date. 4. *Issue TDS Certificate*: Issue a TDS certificate (Form 16A) to the transporter or the person receiving the freight payment. Consult a tax professional or chartered accountant to ensure compliance with TDS regulations and to avoid any potential penalties.

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