Meaning of contract u/s 194C

TDS / TCS 1536 views 6 replies

CA Saravanakumar

Practice

59 Points Posted on 25 October 2009

Hi,

Can any one please help me out with the following query.

"Any person responsible for paying any sum to any resident (hereafter in this section referred to as the contractor for carrying out any work (including supply of labour for carrying out any work) in pursuance of a contract between the contractor and ......."

In case an electrician is undertaking contract work regulary throughout the year but covered under differenct PO each of which is less than Rs. 20000 but the whole sum is in excess of Rs.50000 (for all the POs during the year), is tds required to be deducted? Same way amount is paid to couriers for several biils each of which is less than the 20000 but put together comes to more than Rs. 50000 wthr TDS deductible?

Please clarify. Thanks in advance.

Replies (6)

CA Devanshi Gandhi (Ajani)

FCA DISA Mcom CIFRS & LLB

9060 Points Posted on 25 October 2009

u need to deduct it form the begining if u knw its gng to cross 50000 in a yr or if u dnt knw than u need to deduct cumulatively when the payment crosses 50000.

praveen

Chartered Accountant

6971 Points Posted on 25 October 2009

Originally posted by :CA Devanshi Gandhi
"	u need to deduct it form the begining if u knw its gng to cross 50000 in a yr or if u dnt knw than u need to deduct cumulatively when the payment crosses 50000.	"

I Agree.

santhosh

Student

1174 Points Posted on 26 October 2009

yes... you need to deduct TDS from the beginig itself....... or deduct for the entire amount paid if it crosses Rs 50000/-. Better to do from the begining itself, if you deduct TDS in the last year for that same person or for the same expenses......

Guest

Originally posted by :santhosh
"	yes... you need to deduct TDS from the beginig itself....... or deduct for the entire amount paid if it crosses Rs 50000/-. Better to do from the begining itself, if you deduct TDS in the last year for that same person or for the same expenses......	"

Right

CA Suri Kota

Assistant Manager @ EY

955 Points Posted on 26 October 2009

Yea agree with members advise.............

CA Ratan kandare

CA In job

373 Points Posted on 26 October 2009

u have to deduct the tds when u make the payment in excess of Rs.20000 (one time) or if the total invoice amt of contract is exceed Rs. 50000 in a Year. secondly all the contract is liable for tds whether labour supplies, courier and electrical contrac etc. if it satisfy the above criteria. however the charges in invoice which is reimbursable to the contractor is not liable for t.d.s.

if u fail to deduct tds in a year please deduct it before 31st ma but if no bill is pending u have to deduct and pay on behalf of contractor and reimburesd it from the contarctor.

Ratan kandare