If some company pays to a company, is tds applicable?

For the applicability of chapters of TDS - Status of Payer is not relevant - With Few Exception -

Pls clarify as to the purpose for which payment is made. - If the amount to be paid is taxable in india in the hands of payee - Tax is to be deducted at source by the payer.

Yes rightly said above.You need to check the nature of transaction to put it under the respective section!

Actually these are subcontract/part of main software development work. 

In that case - TDS provisions under section 194C would be attracted.

No distinction of a contract or a sub-contract.

Hope your query is resolved. 

Agreed with CA Prateek Jain.

Genrally TDS having nothing to do with status. so if company is paying to another company so TDS will be applicable.

Also as u mentioned that payment is in relation with Sub-Contractor so this will be come under section of 194C and TDS will be liable to deduct @ 2%.

Originally posted by : Rahul Verma
	Genrally TDS having nothing to do with status. so if company is paying to another company so TDS will be applicable. Also as u mentioned that payment is in relation with Sub-Contractor so this will be come under section of 194C and TDS will be liable to deduct @ 2%.

Thanks Mr. Rahul Verma, I have understood that TDS is applicable, but what will be the percentage? 2% or 10%? Because one of my client has shown me Section 194J, and they are deducting 10%. Thanks in advance.

Dear 

That can be different from case to case basis......

If same is covered in Sub-Contract as u mentioned Then Liable to 2%

If Same is not covered in Sub-Contract and other one holds technical competance the Liable to 10%.