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194q in TDS

Ajay Ingale (15 Points)

29 July 2021  
Please explained me 194q In TDS

 5 Replies

Hari Beldona (ACA) (1517 Points)
Replied 29 July 2021




CBDT issues guidelines under section 194Q


The income tax department issued a circular dated 30th June 2021 laying down the guidelines for TDS deduction under section 194Q. These guidelines are given to remove this section’s difficulties and related sections 194-O and 206(1H). 

Section 194Q was inserted by the Finance Act 2021, which is applicable from 1st July 2021. Section 194Q applies to a buyer who has a:

Turnover of more than Rs.10 crore in the previous financial year.

He purchases goods exceeding Rs.50 lakh of value in a year.

Such a buyer has to deduct TDS at the rate of 0.1% on the amounts exceeding Rs.50 lakh. This section is exactly the opposite of section 206C(1H), where TCS must be collected

Nidhi (Chief Accountant) (2060 Points)
Replied 29 July 2021

Any person, being a buyer who is responsible for paying any sum to any seller (being a resident) for purchase of any goods (including capital goods), where the value or aggregate of such values, exceeds ₹50 lakhs in any P.Y., shall deduct TDS.

Applicable w.e.f.: 1st July, 2021.

Rate of TDS: 0.1% (5% in case PAN is not furnished) of the purchase value exceeding ₹50 lakhs.

Ankit Neema (2732 Points)
Replied 30 July 2021

Comparison of sections 194Q with 206C(1H) https://www.caclubindia.com/share_files/details.asp?mod_id=81345
1 Like

Manoj Singh (236 Points)
Replied 30 July 2021

Hey, This will help you to know about and process too, to know more visit- CA In Delhi

1 Like

Nidhi (Chief Accountant) (2060 Points)
Replied 31 July 2021


download this pdf

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