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Is TDS to be deducted on Gift items purchased

TDS 13391 views 8 replies
company has purchsed a Duffle Bag with a Company's Logo
is there any TDS implications on such purchase ?
if yes then at what rate ? for AY 06-07
Replies (8)
Quick Summary
Discussion on whether TDS applies on purchase of gift items like duffle bags, logo-branded goods, and employee gifts. Views differ: some say 194C applies if work contract exists, others say pure purchase of goods or gifts has no TDS implication.

hi
yes the tds has to be deducted u/s 194C @ 2%+SC+EC
As per Section 194C TDS is required to deductible on Labour Contract.But if Contract contain supply of material as well as labour contract then TDS is required to deductible on whole contract amount.
In the given case if contract consist of supplying of duffle bag as well as printing of Company's Logo then TDS is required to be deducted on whole contract Amount

MY INTERPRETATION IS THAT SEC. 194C COVERS SUCH CONTRACTS WHERE PRINCIPAL CONTRACT IS FOR WORK AND LABOUR AND NOT FOR SALE OF MATERIALS.
( EXTRACTS FROM " MASHBRA'S READY RECKNOR FOR DIRECT TAXES ")

IN ABOVE CASE THE CO. HAS PURCHASED THAT BAG FROM MARKET REQUESTING THAT MAKER OR SELLER TO PRINT LOGO OF CO.  ON THE BAG. NATURALLY THE COST OF PRINTING  IS INCLUDED IN HE COST OF BAG. THE WHOLE AMOUNT IS TRANSACTION VALUE AND THE AMOUNT IS OF EXPENDITURE FOR SELLING AND MARKETING IN THE BOOKS OF CO.  

 Company has given gift to its associates to promote business. I want to know that at what rate the TDS has to be deducted at what rate on the gift given by the company to its associates.Gifts Includes Gold Coins, Laptop, Mobile Phones, Motor Cycle & Car.Please Reply.



if u had received two bills seperately for the purchase of bags and printing charges then tds is to be deducted on printing charges.

otherwise on whole amount tds has to be deducted.



I think on gift items there is no need to deduct TDS. It is not covered under sec. 194C,194J,194H,etc.

ON GIFTS THERE IS NO TDS.

AND ON THE MATTER OF BAG, TDS TO BE DEDUCTED U/S 194C ON WHOLE AMOUNT.

Hi, Do we have to deduct TDS @ 2% on supply of Gift items given to employees (branded with company logo) and if yes which sec is applicable. This is related to FY 2022-23. Please help.  


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