Is tds deductible?

A Company is engaged in textile business. It has hired workers who stitch fabric. The company makes cash payment every 15 days. My query is, whether TDS under 194C (job work) is attracted since the co is supplying material and they are stitching as per the specification of the company. The limit of 75000 gets crossed in a financial year.

 

Thanks

Replies (7)

I think it would be more specific if you provide the basis for payment to the labour for every 15days and furthur as you told you hire labour,are you hiring labour from one organisation or individually? If from one organisation,Yes,Company is liable to deduct T.D.S U/s.194C as the above work come under the definition of "work" for the purpose of T.D.S and aggregate payments made to your contractor organisation exceeds 75000 in aggregate.Nevertheless,no need to dedect T.D.S unless each individual payment exceeds 75000 in a financial year.

Workers are hired not from any organisation. They are individual. Payment to each individual crosses 75000 limit in a financial year.

ACCORDING TO ME TDS IS DEDUCTIBLE ON THE LABOURERS UNDER CONTACTAT THE RATE OF 1% (SC-NIL, EC & SHEC-NIL)[individuals/HUF]

DEAR FARAZ,

ACCORDING TO TDS LIABILITY ON CONTRACTOR 194-C LIMIT IS 75000 OR ABOVBE OR SINGLE TRANSACTION OF 30000 OR ABOVE FOR ANY COMPANY,FIRM,INDIVIDUAL OR HUF AS THE CASE MAY BE.

AS IN YOUR CASE YOUR CO. IS ENGAGED IN HIERING INDIVIDUALS FOR STICHING  FABRIC. WHO JOB WORK CROSS THE LIMIT OF 75000 IN A YEAR. SO YOUR COMPANY IS LAIBLE TO DEDUCT TDS UNDER SECTION 194-C @ 1%  AND INTEREST IN LATE PAYMENT OF @ 1.5% PER MONTH (IF APPLICABLE)

Agreed with above discussion,

Faraz, Co. has to deduct tds @ 1% if the workers have pan card and @ 20% if they don't have pan card.

Dear Feroz

If you are not hire any organization paid excess 75000/- to indivitual  then TDS is applicable. becouse you are not paid as salary. its has contract that is tds is appliable. 

thanks

Ramanuj


 

At first ...in the present case as the Co. have hired workers, any contract signed between the parties?? If yes...chk for the payment terms... If YES....then Tds will apply u/s 194 C

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