Sole prop firm have turnover of 30 lakhs needs to pay tds?

TDS on salary is to be deducted if salary to an "individual employee" is exceeding Rs.2,50,000.

If salary to individual employee is not exceeding this limit, then no need for deduction of TDS as per section 192. For calculating this limit, also consider any tax saving investments done by the employee, i.e which are claimable u/s 80C.

Hi Ravi,

I am assuming that turnover of Rs. 30 lakhs is from business and not profession. In such a case, there is no liability to deduct TDS. Sole proprietorship is the same as individual assessee as per income tax act. Hence, responsibility to deduct TDS and related compliances are applicable to individual only when such assessee is subject to tax audit during the previous year or any preceeding previous years.

If above mentioned criteria is not satisfied, then it doesn't matter even if the assessee pays salary of more than Rs. 2.5 lakhs to any of his employee.

Regards

CA Shivani Mittal

Originally posted by : Shivani Mittal
	Hi Ravi, I am assuming that turnover of Rs. 30 lakhs is from business and not profession. In such a case, there is no liability to deduct TDS. Sole proprietorship is the same as individual assessee as per income tax act. Hence, responsibility to deduct TDS and related compliances are applicable to individual only when such assessee is subject to tax audit during the previous year or any preceeding previous years. If above mentioned criteria is not satisfied, then it doesn't matter even if the assessee pays salary of more than Rs. 2.5 lakhs to any of his employee. Regards CA Shivani Mittal

Hello Shivani Mittal g,

Yes, turnover is from sole properitor business. I assume  tax audit is required if turnover of sole properitor business is greater than equal to 1 crore.

Thanks

Yes, for business limit for tax audit is Rs 1 cr irrespective of the nature of assessee