Implication of Job title on TDS - urgent

Depend on the type and nature of service. Nomenclature is not relevant.

To deduct TDS under section 192, employer employee relationship should be there. You call him a consultant or you do not wish to or find it uncomfortable using that word, you can designate him as chief software architect or chief software specialist or junior software implementation engineer, Team Lead Software Implementation. The English language can throw up a lot of designations that imply a better status.

It will be salary if you make a salary appointment to him for a continuous period whether part time or otherwise. You will also have to comply with laws for ESIC and PF and Professional tax on salary you pay. He will be an extra employee for your records under all acts applicable to you or some acts may become applicable to you by virtue of that extra employee.

If you pay professional fees, you have to deduct 10% TDS on all payments if payments exceed 20000 per annum.

A professional on a monthly retainer basis is not an emploee if he is an independent professional. A monthly retainer is a compromised lumpsum fee per month irrespective of number of assignments and is chargeable to service tax if applicable and also TDS is applicable under section 194J. Monthly retainer will not charge additional fees. He will charge extra out of pocket expenses on which service tax would be billed by him and you have to apply TDS on all these out of pocket expenses. In salary, you do not apply TDS on reimbursements if incurred during course of your business.

This should help you decide what the professional is in your company.

As Per Sec 192, "Any person responsible for paying any income chargeable under the head Salaries shall, at the time of payment, deduct income-tax on the amount payable at the average rate of income-tax computed on the basis of the rates in force for the financial year in which the payment is made, on the estimated income of the assessee under this head for that financial year" 

Therefore the question is whether it is paid as Salary or Professional Fees Matters to determine Section Under which TDS needs to be deducted. THERE IS NO NEED TO BOTHER ABOUT THE DESIGNATION OF THE PERSON.

Software consultants are coming under Consulting engineering services as pre service tax, but the service tax specifically exempt the employment software engineers and tds also normal salary calculation only