Tax deductible@sourse

• Applicability of Section 194Q: 

Any person, being a buyer who is responsible for paying any sum to any resident seller for purchase of any goods, in case the value or aggregate of such values exceeds Rs.50 lakhs in any Previous Year is liable for deduction of tax on such transaction.

• Who shall be considered as buyer for the purpose of this provision?

As per the explanation to Section 194Q (1), a buyer shall be a person whose total sales, gross receipt or turnover exceeds Rs.10 crore in the immediate preceding financial year of the year of transaction.

• Effective date of Applicability: The provision will be effective from 1^stJuly, 2021.
• Rate of TDS: A person being a buyer is liable to deduct tax at the rate of 0.1% of the purchase value in excess of Rs.50 lakhs. However, there is an exception to this, in case the seller is not holding valid PAN, the rate of tax deduction will be 5% under Section 206AA.
• When the person is liable to deduct tax: The person being buyer shall deduct tax at the time which Earlier of the following:
• At the time of credit of such sum to the account of the seller
• At the time of payment by any mode

Ok super extraordinary