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Rate of TDS for customized software.

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STUDENT
40 Points Posted on 14 February 2020
We have a customized webbase software and maintained by a IT company. They recently developed some segment of that software and placed a bill Rs 70000 + IGT 18%. Now, whether we should deduct TDS U/S 194 C 2% or 194 J 10%?
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On 14 February 2020 at 18:12 Report
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Quick Summary
Discussion on TDS rate for customized software development. Payments to IT company for developing or modifying software are treated as technical/professional services, so TDS u/s 194J @10% applies. Some proposals suggest reduction to 2% later, but current applicable rate is 10%.

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banglore
1496 Points Posted on 14 February 2020
10% as it is a professional service
6 Reply
On 14 February 2020 at 23:35
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STUDENT
40 Points Posted on 15 February 2020
Thank You sir
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On 15 February 2020 at 15:31
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17264 Points Posted on 16 February 2020
TDS at 10% under 194J as payment for technical services.

The TDS rate is proposed to be reduced to 2% from 10% for payment towards technical services under 194J ( as in Budget 2020)
Will become effective most likely from 1st June 2020 onwards.
101 Reply
On 16 February 2020 at 20:35


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